Annual Report 2011 - malaysiastock.biz Encik Azmi also sits on the Board of Sapura Industrial...

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Amcorp Properties Berhad (6386-K) (Formerly known as AMDB Berhad)

2.01 PJ Tower, 18 Persiaran Barat, 46050 Petaling Jaya, Selangor, Malaysia. T : +603-7966 2628 F : +603-7966 2629

Annual Report 2011

Am

corp Properties Berhad

Annual Report 201 1

Amcorp Properties Berhad (6386-K)

AmcorpAR(cov)FA.indd 1 8/16/11 11:06 AM

Contents2 Corporate Information

3 Group Financial Highlights

4 Corporate Structure

5 Profile of Directors

10 Chairman’s Statement 12 Statement on Corporate Governance

24 Additional Compliance Information

25 Statement on Internal Control

27 Audit Committee Report

33 Financial Statements

165 Analysis of Shareholdings

168 List of Properties

171 Notice of Annual General Meeting

Form of Proxy

2

BOARD OF DIRECTORS

Azmi HashimExecutive Chairman

Shalina AzmanNon-Independent Non-Executive Deputy Chairman

Tan Sri Dato’ Chen Wing SumIndependent Director

Tan Sri Lee Lam ThyeIndependent Director

Dato’ Larry Gan Nyap Liou @ Gan Nyap LiowIndependent Director

Dato’ Che Md Nawawi bin IsmailIndependent Director

P’ng Soo ThengIndependent Director

Soo Kim WaiNon-Independent Non-Executive Director

Lee Keen PongChief Executive Officer/Executive Director

Shahman AzmanExecutive Director

COMPANY SECRETARIES

Johnson Yap Choon Seng (MIA 20766)Chua Siew Chuan (MAICSA 0777689)

PRINCIPAL PLACE OF BUSINESS 2.01 PJ Tower18 Persiaran Barat46050 Petaling JayaSelangor, MalaysiaTel : +603-7966 2628Fax : +603-7966 2629Website : www.amcorpproperties.com

REGISTERED OFFICE

Level 7, Menara MileniumJalan DamanlelaPusat Bandar DamansaraDamansara Heights50490 Kuala Lumpur, MalaysiaTel : +603-2084 9000Fax : +603-2094 9940 / 2095 0292

AUDITORS

Folks DFK & Co.Chartered Accountants12th Floor, Wisma Tun Sambanthan2 Jalan Sultan Sulaiman50000 Kuala Lumpur, MalaysiaTel : +603-2273 2688Fax : +603-2274 2688

SHARE REGISTRAR

Securities Services (Holdings) Sdn BhdLevel 7, Menara MileniumJalan DamanlelaPusat Bandar DamansaraDamansara Heights50490 Kuala Lumpur, MalaysiaTel : +603-2084 9000Fax : +603-2094 9940 / 2095 0292

STOCK EXCHANGE LISTING

Bursa Malaysia Securities BerhadMain Market(Listed on 28 November 1972)Stock name : AMPROPStock code : 1007

Corporate Information

Amcorp Properties Berhad

3

Group Financial Highlights

2007 2008 2009 2010 2011

1. Profit for the period (RM’000) 24,112 (14,170) 18,451 35,920 50,987

2. Basic earnings per share (Sen) 2.97 (1.14) 5.55 6.92 8.47

3. Total assets (RM’000) 819,185 679,718 578,915 943,046 966,286 4. Shareholders’ funds (RM’000) 365,581 354,822 372,998 525,208 570,433

Profit For The Period (RM’000)

Total Assets (RM’000)

Basic Earnings Per Share (sen)

Shareholders’ Funds (RM’000)

50,9

87

8.47

570,

433

35,9

20 6.92

525,

208

18,4

51

5.55

372,

998

(14,

170)

(1.1

4)35

4,82

2

24,1

12

2.97

365,

581

2011 2010 2009 2008 2007

2011 2010 2009 2008 2007

2011 2010 2009 2008 2007

2011 2010 2009 2008 2007

819,

185 96

6,28

6

943,

046

578,

915

679,

718

Annual Report 2011

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Corporate StructureSignificant Operating Companies

41% Prisma Tulin Sdn Bhd

40% Augustland Hotel Sdn Bhd

20% Bangi Hotel Sdn Bhd

20% Planergo (Pte) Ltd

PROPERTY DEVELOPMENT & INVESTMENT ENGINEERING & INFRASTRUCTURE

OTHER ASSOCIATES

100% Amcorp Prima Realty Sdn Bhd

100% Distrepark Sdn Bhd

100% Regal Genius Sdn Bhd

100% Amcorp Industrial City Sdn Bhd (Formerly known as AMDB Industrial City Sdn Bhd) 100% Taifab Properties Sdn Bhd

100% Mayang Zaman Sdn Bhd

100% Country Realty Limited

100% Riverich Limited

60% HDCam Sdn Bhd (Formerly known as HDC-Amcorp JV Sdn Bhd)

Mechanical & Electrical Engineering 51% Blue Star M&E Engineering Sdn Bhd

Power Engineering & Construction 85% AMBC Transmission Sdn Bhd

Power Generation 100% Amcorp Perting Hydro Sdn Bhd (Formerly known as AMDB Perting Hydro Sdn Bhd)

Manufacturing 30% Lafarge Concrete (Malaysia) Sdn Bhd

Highway Operation 20% Kesas Holdings Berhad


5

Profile of Directors

AZMI HASHIMExecutive Chairman Encik Azmi Hashim, a Malaysian, aged 62, was appointed to the Board on 16 October 1991. He is an accountant by training and has worked in various professional accounting firms both internationally and locally. In Amcorp Properties Berhad (“AMPROP”), he has held the position of General Manager and was subsequently appointed as Managing Director and Director/Adviser on 16 October 1991 and 1 January 1998 respectively, prior to his appointment as Chief Executive Officer on 1 February 2003. Encik Azmi was redesignated as an Executive Chairman of AMPROP on 30 July 2007. Encik Azmi also sits on the Board of Sapura Industrial Berhad.

SHALINA AZMAN Non-Independent Non-Executive Deputy Chairman

Puan Shalina Azman, a Malaysian, aged 44, was appointed to the Board on 30 July 2007. She holds a Bachelor of Science in Business Administration majoring in Finance and Economics from Chapman University in California and in 1993, she obtained her Masters in Business Administration from University of Hull in United Kingdom. Puan Shalina first gained invaluable experience in the media industry when she was a Business Development Officer with RCE Capital Berhad (“RCE”) in 1990. From 1995 to 1999, she was with Amcorp Group Berhad (“AMCORP”) as Senior Manager, Corporate Planning. In January 2000, she rejoined RCE as the Executive Director and became the Managing Director on 1 September 2000. She held the position until 31 July 2002, prior to assuming her current appointment as Deputy Managing Director of AMCORP. She remains as the Non-Independent Non-Executive Director of RCE. Apart from AMCORP and RCE, Puan Shalina is also a Director of MCM Technologies Berhad.

TAN SRI DATO’ CHEN WING SUMIndependent Director Y. Bhg. Tan Sri Dato’ Chen Wing Sum, a Malaysian, aged 79, has been a Director of the Company from 8 August 1997 to 8 December 2000. He resigned from the Board when he was elected President of the Senate and on 29 May 2003, he was re-appointed as Independent Non-Executive Director of the Company following his retirement as President of the Senate. Tan Sri Dato’ Chen is by profession, an advocate and solicitor. He read law in Lincoln’s Inn, London and now serves as Consultant to Messrs Michael Chen & Co. He also read Philosophy and Education in the Chinese University of Hong Kong.

He has been involved in politics and Government service since 1964 and has served as a member of Parliament from 1964 to 1986 and a member of the Senate from 1997 to 2003. He has also served as Parliamentary Secretary, Secretary General of Alliance, Minister with Special Function, Vice-President of MCA, Deputy President of MCA, Minister of Housing, Local Government and New Village, Treasurer General of Barisan Nasional, Deputy President of the Senate and President of the Senate during his tenure as a member of Parliament and the Senate.

He has held positions of Chairman and Director in various corporations during 1972 to 2000. He also has vast experience in international affairs and during his term of office as President of the Senate, he had officially visited Japan, China, Middle East and Latin America. Tan Sri Dato’ Chen is presently the Deputy Chairman of Malaysian South-South Corporation Berhad.

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TAN SRI LEE LAM THYEIndependent Director Y. Bhg. Tan Sri Lee Lam Thye, a Malaysian, aged 65, was appointed to the Board on 1 March 2004.

Tan Sri Lee worked as a temporary school teacher after completing his secondary education at St. Michael’s Institution, Ipoh and a trade unionist before entering politics in 1969. He was elected State Legislative Assemblyman for Bukit Nenas, Selangor from 1969 to 1974 and served as a Member of Parliament for Bandar Kuala Lumpur/Bukit Bintang from 1974 to 1990. Following his retirement from politics in 1990, he continued to serve in public services by contributing actively in the social arena. He has served as Chairman of the National Services Training Council, member of the Malaysian Human Rights Commission from 2000 to 2002 and member of the Special Royal Commission to enhance the operation and management of the Royal Malaysia Police from February 2004 till May 2005. Tan Sri Lee is the Chairman of the National Institute of Occupational Safety and Health (NIOSH) under the Ministry of Human Resources, and the Vice Chairman of the Malaysia Crime Prevention Foundation. He also serves as Chairman and member of trustee board of various foundations and charitable organisations. From 1986 to 2002, he received various awards for his contribution to the nation. Tan Sri Lee also sits on the Board of MBM Resources Berhad, Media Prima Berhad and S P Setia Berhad.

DATO’ LARRY GAN NYAP LIOU Independent Director

Y. Bhg. Dato’ Larry Gan, a Malaysian, aged 56, was appointed to the Board on 30 July 2007.

He is a Certified Management Consultant and a Chartered Accountant.

Dato’ Larry Gan was with Accenture, a global management and technology consulting firm for 26 years until his retirement in December 2004. He was a worldwide partner for 16 years and held many global leadership positions including Managing Partner ASIA and Managing Partner Corporate Development Asia Pacific. He was Chairman of the CEO Advisory Council and member of the Global Management Council from 1997 to 2004.

He served as Chairman of the Association of Computer Industry Malaysia (PIKOM), Vice President of the Association of Asian Oceania Computer Industry Organisation, and a member of the Ministry of Science and Technology Think Tank, Copyright Tribunal, and the Labuan International Financial Exchange Committee.

Dato’ Larry Gan is presently the Chairman of Cuscapi Berhad and Catcha Media Berhad and a Director of AmBank (M) Berhad, Tanjong Public Limited Company, Tien Wah Press Holdings Berhad, AmIslamic Bank Berhad, Saujana Resort (M) Berhad, Prestariang Berhad and Hong Leong Assurance Berhad. He also serves as a Director of the Minority Shareholders Watchdog Group, Deputy Chairman of British Chamber of Commerce, a Trustee and Deputy Chairman of Yayasan Tuanku Nur Zahirah and Advisor to the Center for South East Asia Architectural Heritage.


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DATO’ CHE MD NAWAWI BIN ISMAILIndependent Director Y. Bhg. Dato’ Che Md Nawawi bin Ismail, a Malaysian, aged 61, was appointed to the Board on 30 July 2007.

Dato’ Nawawi holds a Bachelor of Laws from the International Islamic University of Malaysia and practiced as an advocate and solicitor in a legal firm between 1990 and 1991. Dato’ Nawawi was the Deputy Commissioner of Police of the Malaysian Police Force until his retirement in February 2006. He had held several key positions during his 36 years of service with the Malaysian Police Force including the position of Head of Criminal Investigation Department in the State of Sabah and Perlis, OCPD Cheras, Deputy Director Commercial Crime Division and Deputy Director, Criminal Investigation Department in Bukit Aman.

Dato’ Nawawi also sits on the Board of MCM Technologies Berhad and RCE Capital Berhad.

P’NG SOO THENGIndependent Director Mr. P’ng Soo Theng, a Malaysian, aged 56, was appointed to the Board on 1 June 2010.

He holds a Bachelor of Science in Valuation and Estate Management from the University of the West of England (formerly known as Bristol Polytechnic). Mr. P’ng is a Fellow of the Royal Institution of Chartered Surveyors (RICS), a Member of the Institution of Surveyors Malaysia (ISM) and Association of Valuers, Property Managers, Estate Agents and Property Consultants in the Private Sector Malaysia (PEPS).

Mr. P’ng joined Messrs C H Williams Talhar & Wong, one of Malaysia’s leading real estate professional firm in 1981 and had held several senior positions until his redesignation where he now serves as a Consultant of the firm. He was made Partner & Director of the firm in 1989 and Senior Executive Director in 2004. In C H Williams Talhar & Wong, his forte was undertaking consulting appointments and business development for the firm. Mr. P’ng was involved in the valuation exercise for the listing of several REIT companies as well as the sale, structuring, acquisition and due diligence for several high profile transactions involving hotels, commercial properties and commercial development projects. His prior experience stems from a near three year stint in the public sector where he rose to the rank of Acting State Director at the Valuation & Property Services Division, Ministry of Finance.

SOO KIM WAI Non-Independent Non-Executive Director Mr. Soo Kim Wai, a Malaysian, aged 50, was appointed to the Board on 30 July 2007. Mr. Soo is a Chartered Accountant (Malaysian Institute of Accountants), a Certified Public Accountant (Malaysian Institute of Certified Public Accountants), Fellow of the Certified Practising Accountant (CPA), Australia and Fellow of the Association of Chartered Certified Accountants (ACCA), United Kingdom. He joined Amcorp Group Berhad (“AMCORP”) in 1989 as Senior Manager, Finance and has since held various positions. He was appointed as a Director of AMCORP on 13 March 1996 and subsequently as Managing Director on 1 January 1999. Before joining AMCORP, he was in the accounting profession for 5 years with Deloitte KassimChan from 1980 to 1985 and with Plantation Agencies Sdn Bhd from 1985 to 1989.

Apart from AMCORP, Mr. Soo also sits on the Board of AMMB Holdings Berhad, AmProperty Trust Management Berhad, Kesas Holdings Berhad, MCM Technologies Berhad and RCE Capital Berhad.

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LEE KEEN PONG Chief Executive Officer / Executive Director Mr. Lee Keen Pong, a Malaysian, aged 49, was appointed as Chief Executive Officer of the Company on 30 July 2007 and was subsequently appointed to the Board on 19 November 2007. Mr. Lee joined Amcorp Group Berhad (“AMCORP”) in 1991 and has held various positions including Managing Director of Mezzanine Capital (Malaysia) Sdn Bhd and was Head of Direct Investment and Property of AMCORP before he was promoted to his current appointment. Prior to that, he has many years of audit and consultancy experience with two international accounting firms, Coopers & Lybrand and KPMG. Mr. Lee is a Chartered Accountant (Malaysian Institute of Accountants and Institute of Chartered Accountants England and Wales). He is also a Certified Public Accountant (Malaysian Institute of Certified Public Accountants) and sits on the Financial Statement Review and Commerce and Industry Committee of the Institute as a co-opted member. He also sits on the Board of Kesas Holdings Berhad and MCM Technologies Berhad.

SHAHMAN AZMANExecutive Director Encik Shahman Azman, a Malaysian, aged 36, was appointed to the Board as Non-Independent Non-Executive Director on 2 June 2008. He was redesignated as an Executive Director on 1 June 2010.

Upon graduating from Chapman University, U.S.A. with a Bachelor of Communications, Encik Shahman joined Amcorp Group Berhad (“AMCORP”) in 1996. He was subsequently promoted to General Manager spearheading the Corporate Planning and Strategy portfolio. In 2001, he joined MCM Technologies Berhad, a subsidiary of AMCORP, as General Manager of Corporate Planning and Strategy. His last held position in MCM Technologies Berhad was Chief Investment Officer.

Encik Shahman later joined RCE Capital Berhad as Director of Corporate Affairs on 1 April 2004 and was promoted to Director of Strategic Business Unit on 1 January 2006. He was redesignated as Assistant to Executive Chairman of AMCORP on 1 January 2007.

Encik Shahman also sits on the Board of AMCORP, MCM Technologies Berhad and RCE Capital Berhad.



9


DETAILS OF MEMBERSHIPS IN BOARD COMMITTEES

COMMITTEES OF THE BOARD

Audit Committee Nomination andRemuneration Committee

Azmi Hashim

Shalina Azman

Tan Sri Dato’ Chen Wing Sum Member Member

Tan Sri Lee Lam Thye

Dato’ Larry Gan Nyap Liou Chairman

Dato’ Che Md Nawawi bin Ismail Member Member

P’ng Soo Theng

Soo Kim Wai Member

Lee Keen Pong

Shahman Azman

Notes:

Save as disclosed below, none of the Directors have any family relationship with any Directors and/or major shareholders of the Company:

(i) Encik Azmi Hashim is the brother of Tan Sri Azman Hashim (“TSAH”), a major shareholder of the Company;(ii) Puan Shalina Azman is the daughter of TSAH; and(iii) Encik Shahman Azman is the son of TSAH.

None of the Directors have any conflict of interest with the Company.

None of the Directors have been convicted for offences within the past 10 years.

Annual Report 2011

10

Chairman’s Statement

In 2010, the Malaysian economy registered a growth of 7.2%, driven by strong domestic demand from the expansion in private consumption and fuelled by a favourable labour market, positive consumer confidence and higher income levels. A rebound in private investment across all sectors supported by improving domestic economic conditions and external demand, coupled with the continued support by the public sector through infrastructure and public delivery systems enhancement, added to the growth impetus. Against this positive economic backdrop, Amcorp Properties Berhad Group (“the Group”) continued to direct its energy and resources to build on the foundation blocks put in place previously to transform itself into a focused property, engineering and infrastructure group of companies.

FinanCial anD OperatiOnal HigHligHtS

For the financial year ended 31 March 2011, I am pleased to announce that the Group recorded a net profit of RM50.9 million, 42% higher than the net profit of RM35.9 million in the previous financial year ended 31 March 2010.

The financial year was an eventful year with the Group moving further towards its strategic goal of evolving into a focused property, engineering and infrastructure group with the acquisition of investment properties in London, successful local property launches and securing of new engineering and infrastructure projects, as it continued to dispose its non-core investments.

During the financial year, the Group acquired two residential cum commercial properties for a total consideration of GBP23.55 million in prime areas of London. Acquired on an en-bloc basis at favorable prices, the Group expects to gain from rental income and future capital appreciation of these investments. The recent disposal of the Group’s earlier investment in two freehold office buildings located at 40 and 50 Eastbourne Terrace, Paddington, London which netted a profit of approximately RM66 million in slightly less than two years after its acquisition, bears testament to the success of the Group’s foray into the UK property market.

Besides these acquisitions, the Property Division also launched several residential development projects during the year under review, one of which is the Seri Mutiara project. Nestled in the mature residential area of Salak South, Kuala Lumpur, the project comprises 42 units of link houses, semi-detached and bungalow units. The project was launched in December 2010 and is almost completely sold out.

On behalf of the Board of Directors, I am pleased to present the 45th Annual Report and Audited Financial Statements of the Group and the Company for the financial year ended 31 March 2011.


11

Meanwhile at Kayangan Heights, Shah Alam, construction work on the Kenanga Woods bungalow development project has been progressing well with completion targeted in early 2012. Following Kenanga Woods, the Property Division recently launched another phase known as Bergonia Crescent, comprising 15 units of cluster bungalows. With this latest launch, the total gross development value of bungalow projects launched to-date within Kayangan Heights is in excess of RM100 million.

Over at Sibujaya, Sarawak, the Property Division building on the success of previous phases, launched the 5th phase of its residential project, known as Belian Residence, which comprise 128 units of terrace houses. Sales have been encouraging thus far. Overall, the Property Division continues to transform itself throughout the financial year under review. During the year, it disposed its land in Sepang, Selangor for a cash consideration of RM122 million. Due for completion by the first quarter of 2012, proceeds from the disposal will be utilised to reduce the Group’s borrowings and to fund its future strategic acquisitions and projects. Most recently, the Group entered into a conditional sale and purchase agreement to acquire retail and office lots, business suites and car park bays within a mixed commercial development known as Amcorp Trade Centre for a total consideration of RM75 million (“the Properties”). Located within the bustling commercial hub of Petaling Jaya, Selangor, the Properties are expected to provide the Group with a stable and sustainable rental income with potential for future revenue and capital growth.

The Engineering & Infrastructure Division continued to pursue viable projects in the market. Riding on its project management expertise and track records, AMBC Transmission Sdn Bhd successfully clinched four projects floated by Tenaga Nasional Berhad with a total contract value of approximately RM68 million whilst Blue Star M&E Engineering Sdn Bhd continued to contribute positively to the Group with secured job orders exceeding RM120 million.

The Group’s 4MW renewable energy power plant located at Sg. Perting, Pahang continues to operate well with generation capacity consistently meeting its supply commitments. Encouraged by the success of this project, the Group is currently engaged in negotiations for a 2nd renewable energy power plant project.

OutlOOk

With the world economic recovery still uncertain, the Board will continue to navigate the Group through the unpredictable times ahead along its strategic plans and barring any unforeseen circumstances, the Group can look forward to another successful year ahead.

AcknOwledgement

On behalf of the Board, I would like to extend our gratitude to our customers, shareholders, bankers and various stakeholders for their wonderful support.

Last but not least, I would like to thank my fellow Board members, the management team and employees for their contribution and dedication to the Group.

Azmi HashimExecutive Chairman

11 August 2011

chairman’s Statement

Annual Report 2011

12

Statement on Corporate Governance

The Board of Directors of Amcorp Properties Berhad (“AMPROP” or “the Company”) recognises the importance of safeguarding and promoting the interests of shareholders. The Board is committed to uphold the value of good corporate governance by continuously advocating transparency, accountability, integrity and responsibility to enhance long term shareholders’ values and safeguarding the stakeholders’ values.

The Board is pleased to report on the corporate governance practices of the Company and the manner in which the Company has complied with the principles and best practices as set out in the Malaysian Code on Corporate Governance (Revised 2007) (“Code”).

BOARD OF DIRECTORS

Board Composition and Balance

The Group is helmed by an effective and experienced Board comprising individuals of caliber and credibility from a diverse professional backgrounds with a wealth of experience, skills and expertise. The Directors together as a team set the values and standards of the Company and ensures that the Group’s business is properly managed to safeguard the Group’s assets and shareholders’ investment. A brief profile of each Director is set out in the Profile of Directors section of this Annual Report.

The Board’s composition of ten (10) members, comprising three (3) Executive Directors, two (2) Non-Independent Non-Executive Directors and five (5) Independent Directors is in compliance with paragraph 15.02 of Bursa Malaysia Securities Berhad Main Market Listing Requirements (“Listing Requirements”). The independent directors which make up half of the Board play a crucial role in the exercise of independent assessment and objective participation in Board deliberations and the decision-making process. The independent directors do not participate in the day-to-day management of the Company and do not engage in any business dealings and are not involved in any other relationship with the Company which could materially interfere with the exercise of their independent judgement.

The role of the Executive Chairman, Encik Azmi Hashim and Chief Executive Officer/Executive Director, Mr. Lee Keen Pong are separate with clear distinction of responsibility between them. The Executive Chairman is primarily responsible for the orderly conduct and working of the Board whilst the Chief Executive Officer/Executive Director is responsible for the day-to-day running of the business and implementation of Board’s policies and decisions.

The Board has not identified any independent director as the Senior Independent Non-Executive Director. Any concerns relating to the Group may be conveyed by the stakeholders to any of the independent directors.

The Board through the Nomination and Remuneration Committee conducts an annual review of the performance of the Board to ensure that it is continuously effective. The review is conducted via a set of questionnaires to assist the reviewer in his assessment and is spread over the following three (3) key areas:

• the effectiveness of the Board as a whole;• Board size, composition and balance; and• contributions of individual Directors/Chief Executive Officer to the Board.


13

Duties and Responsibilities

The Board’s principal focus is the overall strategic direction, development and control of the Group. In support of this focus, the Board maps out and reviews the Group’s medium and long term strategic plans on an annual basis, so as to align the Group’s business directions and goals with the prevailing economic and market conditions. It also reviews the management’s performance and ensures that necessary financial and human resources are available to meet the Group‘s objectives. The Board’s other main duties include regular oversight of the Group’s business performance, and ensuring that the internal controls and risk management processes of the Group are well in place and are implemented consistently to safeguard the assets of the Group.

On-going succession planning and training which is aligned to the organisation’s objectives are put in place to ensure orderly management transition in the Group.

Board Meetings and Supply of Information

The Board meets at least four (4) times annually with additional meetings convened as and when deemed necessary. During the financial year, the Board met four (4) times where it deliberated and considered a variety of matters including the Group’s financial results, budget and strategy, corporate proposals and strategic issues that affect the Group’s business operations.

The Board and Board Committee meetings are planned in advance prior to the commencement of a new year and the schedule is circulated to the Directors and Committee members well in advance to enable them to plan ahead. Board members are given at least seven (7) days’ notice before any Board meeting is held. The agenda for each Board meeting and papers relating to the matters to be deliberated at the meeting are forwarded to all Directors for perusal prior to the date of the Board meeting. The Board papers are comprehensive covering agenda items to facilitate informed decision-making. In between Board meetings, approvals on matters requiring the sanction of the Board are sought by way of circular resolutions enclosing all relevant information to enable the Board to make informed decisions. All circular resolutions approved by the Board will be tabled for notation at the next Board meeting.

The Board also peruse the decisions deliberated by Board Committees through minutes of these committees. The Chairman of the Board Committees is responsible to inform the Directors at Board meetings of any salient matters noted by the Committees and which require the Board’s notice or direction. All proceedings of Board meetings are minuted and signed by the Chairman of the meeting in accordance with the provisions of Companies Act, 1965.

There is a schedule of matters reserved specifically for Board’s deliberation, such as approval of corporate plans and annual budgets, recommendation of dividends, acquisitions and disposals of undertakings and properties of substantial value. Where a potential conflict of interest arises, it is mandatory for the Director concerned to declare his interest and abstain from the deliberation and decision-making process.

The Board has complete and unrestricted access to information relating to the Group’s businesses and affairs. The Board may require to be provided with further details on the matters to be considered. Senior management are invited to attend the Board meetings to brief and provide comprehensive explanation on pertinent issues. Professional advisers appointed by the Company for corporate proposals to be undertaken by the Company would also be invited to render their advice and opinion to the Directors. The Directors, whether collectively as a Board or in their individual capacity, have the liberty to seek external and independent professional advice, if so required by them, in furtherance of their duties at the Company’s expense.


Annual Report 2011

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The Directors are notified of any corporate announcements released to Bursa Malaysia Securities Berhad. They are also notified of the impending restriction in dealing with the securities of the Company at least thirty (30) days prior to the targeted release date of the quarterly financial results announcement.

All Directors have direct access to the advice and services of the Company Secretaries. The Company Secretaries are responsible in ensuring that Board procedures are met and constantly advise the Directors on compliance issues.

Details of attendance of Directors at Board meetings during the financial year are as follows:

Name of Director No. of Meetings Attended

Azmi Hashim 4/4 Shalina Azman 3/4 Tan Sri Dato’ Chen Wing Sum 3/4 Tan Sri Lee Lam Thye 4/4 Dato’ Ab. Halim bin Mohyiddin 3/4(Resigned on 12 August 2011) Dato’ Larry Gan Nyap Liou 4/4 Dato’ Che Md Nawawi bin Ismail 4/4 P’ng Soo Theng 3/3(Appointed on 1 June 2010) Soo Kim Wai 4/4 Lee Keen Pong 4/4 Shahman Azman 4/4

Appointment to the Board

The proposed appointment of new Board members as well as the proposed re-election of existing Directors who are seeking re-election/re-appointment at the annual general meeting are first considered and evaluated by the Nomination and Remuneration Committee. Upon its evaluation, the Nomination and Remuneration Committee will make recommendations on the proposal(s) to the Board for approval. The Board makes the final decision on the proposed appointment or re-election/re-appointment to be presented to shareholders for approval.

Re-election of Directors

In accordance with the Company’s Articles of Association, one-third (1/3) of the Directors are subject to retirement by rotation at every annual general meeting and provided always that all Directors shall retire from office at least once every three (3) years but shall be eligible for re-election. Directors who are appointed by the Board are subject to re-election by the shareholders at the annual general meeting held following their appointments.


15

Directors of or over 70 years of age are required to submit themselves for re-appointment annually in accordance with Section 129(6) of Companies Act, 1965.

Directors’ Training

The Board acknowledges the importance of continuous training in order to broaden one’s perspective and to keep abreast with the current and future developments in the industry and global markets, regulatory updates as well as management strategies to enhance the Board’s skills and knowledge in discharging their duties. Orientation programme is initiated for newly appointed Directors to familiarise them with the Group’s business. All the Directors have attended the Mandatory Accreditation Programme prescribed by Bursa Malaysia Securities Berhad.

During the financial year under review, the Company had organised in-house seminars on “Leadership Versus Management” and “Budget 2011 – Transformation Toward a Developed and High Income Nation” conducted by external consultants for the Directors and senior management. The Directors also continued to attend and participate in various training programmes, briefings, conferences and seminars, which they have individually considered as relevant and useful to further enhance their business acumen and professionalism in discharging their stewardship responsibilities.

Some of the conferences, seminars, forums and trainings attended by the Directors during the financial year ended 31 March 2011 are as follows:

Key Areas Topics

Corporate Governance & Risk Management

• DevelopinganAnti-MoneyLaunderingRiskAverseCultureWithoutAffectingProfitability

• SecuritiesCommission-BursaMalaysiaCorporateGovernanceWeek2010:- Corporate Governance Roundtable: Towards Corporate Governance

Excellence- Engagement verses Activism: Achieving the Right Balance?- The Changing Landscape of Shareholders Activism: The Roles We Play- Independent Directors: Actual verses Perceived Independence- Views from the Boardroom: Challenges Directors Face- CG Best Practices- Statement on Risk Management and Internal Control- Stoking the Fire of Corporate Governance- Corporate Governance: Steering Capital Market Towards Financial Reporting

Excellence• DevelopingHighImpactBoard• GoingForward:Risk&Reform–ImplicationsforAuditCommitteeOversight• IBMITRiskManagementSeminar

Directors’ Duties &Obligations

• SecuritiesCommission-BursaMalaysiaCorporateGovernanceWeek2010- Boardroom Ethics- Board Role, Directors Duties and Blind Spots, Biases and Other Pathologies

in the Boardroom• MandatoryAccreditationProgrammeforDirectorsofPublicListedCompanies

Leadership • LeadershipversusManagement


Annual Report 2011

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Key Areas Topics

Financial , Taxation &Investment

• Budget2011–RisingAbovetheCompetition• Budget2011–TransformationTowardaDevelopedandHighIncomeNation• BaselIIandTheGlobalFinancialCrisis• Off-BalanceSheetItems,OffshoreAccounts&Derivatives• BankNegaraMalaysia/FinancialInstitutions

Directors’ Education Programme – Module 1• BankNegaraMalaysia/FinancialInstitutions



Directors’ Education Programme – Module 4• TheDebtRecoveryProcess• FinancialIndustryConference

Business & Economics

• HowSustainableOurBusiness• EconomicTransformationProgramme(ETP)• ImprovingBusinessAcumenandDecisionMaking• ChinaAutomotiveIndustryFieldTrip–BeijingMotorShow,PlantVisitsandChina

Automotive Briefing• AutomotiveIndustryUpdate–IranMarketAssessment,IndiaMarketAssessment

and Malaysian Market Update• MalaysiainaGlobalisedWorld• SustainabilityProgramme–Plantation,construction,propertyandhotel• OSK2011MarketOutlook• CreditSuisseMarketOutlook• MySuccessStory

The Nomination and Remuneration Committee has reviewed and is satisfied that the Directors have received the necessary training during the financial year under review which enhanced their effectiveness and contribution to the Board.

Directors’ Remuneration

All Non-Executive Directors are paid Directors’ fees as approved by the shareholders at the annual general meeting based on the recommendation of the Board. The determination of the level of fees of the Non-Executive Directors is a matter decided by the Board as a whole to ensure that it is sufficient to attract and retain the services of the Non-Executive Directors which are vital to the Company. Meetings attendance allowance are paid to Non-Executive Directors in accordance with the number of meetings attended during the financial year. Individual Directors will abstain from participating in the discussion and decision of their own remuneration.

For the Executive Directors, the remuneration packages link rewards to individual as well as corporate performance and achievement of key performance indicators, taking into consideration the market and industry practice. Save as disclosed below, there is no other long term incentives such as share option scheme implemented for the Executive Directors. The Company has in place Directors’ and Officers’ liability insurance (“D&O”) and the Directors are required to contribute jointly to the premium of the D&O policy.



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Details of the remuneration of the Directors of the Company for the financial year ended 31 March 2011 are as follows:

• Aggregate Remuneration

Category ExecutiveDirectors (RM)

Non-ExecutiveDirectors (RM)

Total(RM)

Fees Other EmolumentsDefined contributionsBenefits-in-kind

4,0003,093,875602,342339,091

188,00093,00015,12078,998

192,0003,186,875617,462418,089

• Analysis of Remuneration

Range of Remuneration No. of ExecutiveDirectors

No. of Non-ExecutiveDirectors

RM50,000 & below – 7

RM150,001 – RM200,000 – 1

RM550,001 – RM600,000 1 –

RM1,500,001 – RM1,550,000 1 –

RM1,850,001 – RM1,900,000 1 – The disclosure of Directors’ remuneration is made in accordance with Appendix 9C, Part A, item 11 of the Listing Requirements. The Board is of the opinion that the disclosure of Directors’ remuneration through “band disclosure” is sufficient to meet the objectives of the Code. Separate and detailed disclosure of individual Director’s remuneration would not add significantly to the understanding of shareholders and other interested persons in this aspect.

WHISTLE BLOWING POLICY

The Group in its effort to enhance corporate governance has put in place a whistle blowing policy to provide an avenue for employees and stakeholders to report genuine concerns about malpractices, unethical behaviour, misconduct or failure to comply with regulatory requirements without fear of reprisal. Any concerns raised will be investigated and a report and update is provided to the Audit Committee.

BOARD COMMITTEES

The Board has delegated certain responsibilities to the Board Committees which operate within defined terms of reference approved by the Board to assist the Board in discharging its fiduciary duties and responsibilities. The Board Committees include the Audit Committee, Nomination and Remuneration Committee and Management Committee. The Board had on 30 December 2010 dissolved the Management Committee.

The Board Committees exercise transparency and full disclosure in their proceedings. Where necessary, issues deliberated by the Board Committees are presented to the Board with the appropriate recommendations. The ultimate responsibility for the final decision on all matters however, lies with the Board.


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The Board Committees in AMPROP are as follows:

Audit Committee

The Audit Committee comprises two (2) Independent Non-Executive Directors with the resignation of Dato’ Ab. Halim bin Mohyiddin as Chairman of the Audit Committee on 12 August 2011. The Company shall within three (3) months fill the vacancy pursuant to paragraph 15.19 of the Listing Requirements and the terms of reference of the Audit Committee. The members of the Audit Committee are as follows:

1. Tan Sri Dato’ Chen Wing Sum (Independent Director) 2. Dato’ Che Md Nawawi bin Ismail (Independent Director)

The Audit Committee’s principal role is to reduce conflicts of interest particularly between management and shareholders and to ensure that the Group’s assets are utilised efficiently. As part of the Audit Committee’s responsibilities, they would review the Company’s financial statements, related party transactions and the system of internal controls. They may also consider whether procedures on internal audit are effective at monitoring adherence to the Company’s standards and values.

During the financial year, the Audit Committee held four (4) meetings whereby the external auditors attended two (2) of the meetings and also met with the Committee members without the presence of the management and Executive Directors.

A full Audit Committee Report enumerating its membership, terms of reference and a summary of activities during the financial year are set out in the Audit Committee Report.

Nomination and Remuneration Committee

The Nomination and Remuneration Committee comprises entirely of Non-Executive Directors and its members are as follows:

1. Dato’ Larry Gan Nyap Liou (Independent Director) – Chairman 2. Tan Sri Dato’ Chen Wing Sum (Independent Director) 3. Dato’ Che Md Nawawi bin Ismail (Independent Director)

4. Soo Kim Wai (Non-Independent Non-Executive Director)



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The role of the Nomination and Remuneration Committee, set out in its terms of reference, includes among others, the following:

(a) Appointment and Evaluation

(i) To consider and recommend candidates for directorship to the Board and membership to Board Committees based on the following broad criteria:- skills, knowledge, expertise and experience;- professionalism; - integrity; and- for independent non-executive directors, the ability to discharge their duties.

(ii) Reviewing annually the required mix of skills, experience and other qualities, including core competencies, which Directors should bring to the Board.

(iii) Assessing annually the effectiveness of the Board as a whole, including its size and composition, the committees of the Board and the contribution of each individual Director.

(iv) Reviewing the training needs of Directors.

(b) Remuneration

(i) To recommend to the Board on the framework or broad policy for the remuneration of the Company’s or Group’s Chief Executive and other senior management as the Committee is designated to consider.

The Nomination and Remuneration Committee meets at least once in a financial year and whenever required. During the financial year, the Nomination and Remuneration Committee held two (2) meetings during which the Committee:

• undertook an evaluation exercise on the effectiveness, composition and balance of the Board as well as effectiveness of the Committees and contribution from each individual Director of the Company;

• undertook a review of all Directors who are due for re-election/re-appointment at the Company’s Forty-Fourth Annual General Meeting to determine whether or not to recommend their re-election/re-appointment;

• reviewed the training courses attended by the Directors; • reviewed the annual salary increment and bonus for the Executive Chairman and Chief Executive Officer;• reviewed and recommended the redesignation of a Non-Independent Non-Executive Director to Executive

Director and his remuneration package;• reviewed and recommended the appointment of an additional Independent Director to the Board; and• reviewed the renewal of Service Agreement for the Deputy Chairman and the Chief Executive Officer/Executive

Director.

The Committee also reviewed the size of the Board and had concluded that it was appropriate.


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Management Committee

The Management Committee which was established on 4 September 2007 was dissolved by the Board on 30 December 2010. The members were as follows:

1. Azmi Hashim (Executive Chairman) – Chairman 2. Shalina Azman (Non-Independent Non-Executive Deputy Chairman) 3. Soo Kim Wai (Non-Independent Non-Executive Director)

4. Lee Keen Pong (Chief Executive Officer/Executive Director)

5. Yap Choon Seng (Chief Financial Officer/Company Secretary)

The Management Committee was established with the objective of determining the general directions and administering day-to-day operational issues for AMPROP Group. It also acts to facilitate decisions to be made to the Board including making recommendations and proposals to the Board.

The Management Committee held eight (8) meetings during the financial year ended 31 March 2011.

ACCOUNTABILITY AND AUDIT

Financial Reporting

The Board endeavours to present a balanced and comprehensive assessment of the Group’s financial performance through the annual audited financial statements and quarterly announcement of financial results to shareholders. The Board is assisted by the Audit Committee to oversee the Group’s financial reporting processes and the quality of its financial reporting.

Directors’ Responsibility Statement

The Directors are required by the Companies Act, 1965 to ensure that the financial statements prepared for each financial year give a true and fair view of the state of affairs of the Group and the Company as at the end of the financial year, and of the results of their operations and cash flows for the financial year. The Directors consider that in preparing the financial statements, the Directors have consistently used and applied the appropriate and relevant accounting policies and made judgements and estimates that are reasonable and prudent.



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The Directors have a general responsibility in ensuring that the Company and the Group keep proper accounting records in accordance with the provisions of the Companies Act, 1965 to enable the preparation of the financial statements with reasonable accuracy. The Directors are also responsible for taking reasonable steps to safeguard the assets of the Company and the Group to prevent and detect fraud and other irregularities.

Internal Control

The Board acknowledges its overall responsibility in maintaining an internal control system that provides reasonable assurance of effective and efficient operations, compliance with laws and regulations, as well as internal procedures and guidelines. However, the Group’s system of internal control is designed to manage and not eliminate the risk of failure to achieve the Group’s objectives, hence the internal control system can only provide reasonable and not absolute assurance against the risk of material errors, fraud or loss.

The Statement on Internal Control, which provides an overview of the state of internal control within the Group, is set out on pages 25 to 26 of this Annual Report.

Audit Committee

The Audit Committee conducts a review of the Internal Audit Function in terms of its authority, resources and scope as defined in the Internal Audit Charter adopted by the Group. The minutes of the Audit Committee meetings are tabled to the Board for perusal and for action where appropriate.

Relationship with Auditors

The Company, through its Audit Committee, has established a transparent and appropriate relationship with the Company’s auditors, both internal and external. It is the policy of the Audit Committee to meet the external auditors, Messrs Folks DFK & Co. to discuss their audit plan, audit findings and the financial statements. The Audit Committee also meets the external auditors without the presence of the management and executive Board members at least twice a year and whenever deemed necessary.

The roles of both the internal and external auditors are further described in the Audit Committee Report.

RELATIONSHIP AND COMMUNICATION WITH SHAREHOLDERS AND INVESTORS

Communication with Shareholders

The Board is committed to provide shareholders and investors accurate, useful and timely information about the Company, its businesses and its activities. The Company has regularly communicated with shareholders and investors in conformity with the disclosure requirements.

The Company’s annual general meeting remains the principal forum for dialogue and interaction with shareholders and provides an opportunity for the shareholders to seek and clarify any issues and to have a better understanding of the Group’s business and corporate development.


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The Group ensures that timely disclosures are made to the public with regard to the Group’s corporate proposals, financial results and other required announcements.

Corporate and financial information of the Group as well as the Company’s announcements to Bursa Malaysia Securities Berhad are also made available to the public through the Company’s website at www.amcorpproperties.com.

Investor Relations

The Board also encourages and values dialogues with its investors. Personnel of the Company have always looked forward to holding discussions with analysts and shareholders from time to time.

Primary contact for investor relations matters is Mr. Johnson Yap Choon Seng, the Company Secretary and Group Chief Financial Officer. Mr. Johnson Yap, aged 41, has been with the Group for 4 years. He obtained his Master in Business Administration at National University of Singapore and is a Fellow of the Association of Certified Chartered Accountants (ACCA). He is also a member of the Malaysian Institute of Accountants (MIA).

Contact DetailsTelephone number: +603-7966 2300Email : [email protected]

CORPORATE SOCIAL RESPONSIBILITY

The Group recognises the importance of corporate social responsibility (“CSR”) as an integral part of business and strongly pursue its belief of caring for and sharing with people, business associates and the community. In this respect, the Group continued its initiative to strive for a balanced approach in achieving its business profitability and the expectation of its stakeholders and the community thereby creating value to our shareholders and enhancing the long term sustainability of the Group.

The Group together with its holding company, Amcorp Group Berhad (“Amcorp”) worked together with National Kidney Foundation (“NKF”) by supporting to the various events, programmes and activities organised by NKF in various forms such as donations, sponsorships, staff volunteers and resources. In collaboration with NKF, free health screening for the public were held in Putrajaya for the government servants and public to raise awareness of kidney diseases and their prevention and better health management. Cash donations collected during the event was channeled to NKF which went towards providing subsidised dialysis treatment and medication for the needy kidney failure patients. Additionally, collection of old newspapers campaign was conducted where the old newspapers collected are then sent to the Community Recycle for Charity (“CRC”) via NKF. CRC serves the needy community through its environment-friendly practices of recycling and the funds collected by CRC will be used to help the needy community.

The Group also participated in the “100 years 100 good deeds” campaign undertaken by Amcorp in conjunction with Amcorp’s 100 years anniversary. The campaign encompassed a broad spectrum of activities from helping the orphans to providing educational assistance and supporting national events, environmental protection, providing much needed support to disaster victims, fund raising for several NGOs as well as initiate talks and recycling campaigns to promote awareness.



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In support of National Blood Bank’s call for blood donation, the Group had conducted a blood donation campaign at Amcorp Mall, Petaling Jaya in August 2010.

As part of its CSR efforts, the Group together with Amcorp organise and support a number of community services. The Group encourages its employees to extend a helping hand to the less fortunate as well as to victims of natural disasters such as the flood in Perlis and the earthquake and tsunami in Japan. Visits to orphanages and homes of the less fortunate provide comfort and words of wisdom.

The Group continues to play its part in preserving the environment and reducing the carbon footprint to ensure sustainability of the world’s natural resources. Additionally, the Group also promote a culture of waste minimisation and resource optimisation. Various recycling campaigns such as paper and plastic recycling campaigns, collection of old magazines and used books were carried out to encourage staff to adopt the habit to reduce, reuse and recycle as much as possible, both at home and at work.

In conjunction with Earth Hour 2011 on 26 March 2011, the Group continued to show its support by switching off external lightings in Amcorp Mall, Petaling Jaya and encouraging its employees to switch off all non-essential lights in office and at home for one hour. Talks by experts to raise awareness of environmental issues were also conducted for employees.

In recognition of employees being the most important asset to drive the organisation to great successes and acknowledges their invaluable contribution to the organisation’s growth, the Group always endeavoured to safeguard the welfare, healthcare, training and career development for its employees. On-going in-house training is conducted from time to time to equip employees with the necessary skills and knowledge. Health awareness talks are held regularly together with health service providers to educate the employees on healthy lifestyle and various preventive measures against diseases. To promote healthy lifestyle and work-life balance among staff, various recreational and sporting activities were organised and sponsored. Some of the activities carried out were futsal, marathon-run for a cause, SkyTrex adventure, treasure hunt, mount climbing and eco-friendly gift exchange among staff during year end party. Training on City Survival by a well known experienced trainer was conducted strictly for female employees on the preventive measures so as to avoid confronting a would-be attacker.

A great deal of effort and resources are channeled into the Group’s CSR programmes and the top management are directly involved in the Group’s CSR efforts. The Group looks upon the giving back to society in the hope of making a difference in the many lives it touches. This Statement on Corporate Governance is made in accordance with the resolution of the Board of Directors dated 24 May 2011.


Children from orphanage homes receiving duit raya during the Hari Raya Qurban

celebration

Staff participants in Awam 6th Charity Walk-about Treasure Hunt

Uniform donation to the children at Desa Amal Jireh Home

Donation of books to orphanage home in Siem Reap during company trip

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Additional Compliance Information

1. Material Contracts

Save as disclosed in Note 42.5 to the Financial Statements, there were no material contracts entered into by the Company and/or its subsidiaries involving Directors‘ and/or major shareholders‘ interests, either still subsisting at the end of the financial year or entered into since the end of the previous financial year.

2. Share Buy-Back

The information on share buy-back during the financial year is set out in Note 22 to the Financial Statements.

3. Options or Convertible Securities

During the financial year, there were no options or convertible securities exercised and the Company did not issue any options or convertible securities.

4. Depository Receipt Programme

There were no Depository Receipt Programme sponsored by the Company during the financial year.

5. Non-Audit Fees

The amount of non-audit fees incurred for services rendered to the Company and its subsidiaries by the Company’s auditors, or a firm or corporation affiliated to the auditors’ firm for the financial year ended 31 March 2011 was RM86,000.

6. Profit Guarantee

There was no profit guarantee given by the Company during the financial year.

7. Imposition of Sanctions and/or Penalties

There were no sanctions and/or penalties imposed on the Company and its subsidiaries, Directors or management by the relevant regulatory bodies during the financial year.

8. Variation in Results

There were no variances of 10% or more between the audited results for the financial year and the unaudited results announced.

9. Utilisation of Proceeds

During the financial year, there were no proceeds raised from any corporate proposal.

10. Revaluation Policy

The Group has not adopted any revaluation policy.

11. Recurrent Related Party Transactions

The information on recurrent related party transactions for the financial year is set out in the Financial Statements.


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Statement on Internal Control

The Board of Directors (“Board”) is responsible for the Group’s system of internal control and for reviewing its adequacy and integrity.

However, the Group’s system of internal control is designed to manage and not eliminate the risk of failure to achieve the Group’s objectives, hence it can only provide reasonable and not absolute assurance against material misstatement or loss.

The Board of Amcorp Properties Berhad (formerly known as AMDB Berhad) is pleased to disclose that:

(i) there is an on-going process for identifying, evaluating and managing the significant risks faced by the Group throughout the financial year; and

(ii) the said process is regularly reviewed by the Board and accords with the Statement on Internal Control: Guidance for Directors of Public Listed Companies.

The Board summarises below the process it has applied in reviewing the adequacy and the integrity of the system of internal control:

(i) The Board has appointed the Audit Committee to examine the effectiveness of the Group’s systems of internal control on behalf of the Board. This is accomplished through the review of the internal audit department’s work, which focuses on areas of priority as identified by risk analysis and in accordance with audit plan approved by the Audit Committee.

The Group has an Internal Audit Division which is independent of the activities it audits. The Internal Audit Division

is headed by Ms. Foo Li Wah, aged 52, since year 2006. She is a member of the Institute of Chartered Accountants in England and Wales (ICAEW).

(ii) The Group’s Risk Management framework is outlined in the Group’s Risk Management Policy. The Audit Committee shall assist the Board in evaluating the adequacy of the Group’s Risk Management framework. A Risk Management Committee comprising members of senior management monitors the risks faced by the Group and the Risk Management Committee reports to the Audit Committee. The Risk Management Committee is chaired by Encik Azmi Hashim, aged 62, who is also the Group’s Executive Chairman.

The operations of the Group are exposed to a variety of financial risks, including interest rate risk, foreign currency risk, credit risk and liquidity and cashflow risk. The nature and extent of the risks and the measures taken by the Group to minimise those risks are disclosed in the notes to the financial statements.

(iii) The framework of the Group’s system of internal control and key procedures include:

• A management structure exists with clearly defined lines of responsibility and the appropriate levels of delegation.

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Statement on Internal Control

• Key functions such as accounts, tax, corporate secretarial, treasury, insurance and legal matters are controlled centrally. The Corporate Secretarial Department is headed by the Company Secretary, Mr. Johnson Yap Choon Seng, aged 41, who is also the Group Chief Financial Officer. He was appointed as the Company Secretary in year 2007. He obtained his Master in Business Administration from the National University of Singapore and is a Fellow of the Association of Certified Chartered Accountants (ACCA). He is also a member of the Malaysian Institute of Accountants (MIA).

• The management determines the applicability of risk monitoring and reporting procedures and is responsible for the identification and evaluation of significant risks applicable to their areas of business together with the design and operation of suitable internal controls.

• Policies and procedures are clearly documented in the Corporate Policy Manual and Standard Operating Procedures of most of the Operating Units in the Group in which their operations must comply.

• Corporate values, which emphasises ethical behaviour, quality products and services, are set out in the Group’s Employee Handbook.

(iv) The Group also practices Annual Budgeting and monitoring process as follows:

• There is an annual budgeting process for each area of business and approval of the annual budget by the Board.

• Actual performance compared with budget together with explanation of any major variance is reviewed monthly while budget for the current year is reviewed at least semi-annually.

There were no material losses incurred during the current financial year as a result of weaknesses in internal control.


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Audit Committee Report

MEMBERS OF THE AUDIT COMMITTEE The Audit Committee of Amcorp Properties Berhad consists of:

Name Designation Directorship

Dato’ Ab. Halim bin Mohyiddin* Chairman Independent Director(Resigned on 12 August 2011)

Tan Sri Dato’ Chen Wing Sum Member Independent Director

Dato’ Che Md Nawawi bin Ismail Member Independent Director

Note:* Dato’ Ab. Halim bin Mohyiddin is a member of the Malaysian Institute of Accountants. The Company shall within three (3) months fill the vacancy pursuant to paragraph 15.19 of Bursa Malaysia Securities Berhad Main Market

Listing Requirements and the terms of reference of the Audit Committee.

MEETINGS AND ATTENDANCE

During the financial year ended 31 March 2011, the Audit Committee held four (4) meetings. The details of attendance of the Audit Committee members are as follows:

Name No. of Meetings Attended

Dato’ Ab. Halim bin Mohyiddin 3/4(Resigned on 12 August 2011)

Tan Sri Dato’ Chen Wing Sum 3/4

Dato’ Che Md Nawawi bin Ismail 4/4

The representative of the Internal Audit attended all the meetings held during the financial year. Other senior management personnel and the representatives of the external auditors also attended these meetings upon invitation to brief the Audit Committee on specific issues.

TERMS OF REFERENCE

The terms of reference of the Audit Committee are as set out below:

1.0 Composition

1.1 The Audit Committee shall be appointed by the Board of Directors from among their number and shall consist of not less than three (3) members, all of whom must be non-executive directors, with a majority of them being independent directors.

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1.2 The Board shall at all times ensures that at least one (1) member of the Audit Committee:

(i) must be a member of the Malaysian Institute of Accountants (MIA); or

(ii) if he or she is not a member of the MIA, he or she must have at least three (3) years’ working experience and: (a) he or she must have passed the examinations specified in Part I of the 1st Schedule of the

Accountants Act 1967; or(b) he or she must be a member of one of the associations of accountants specified in Part II of

the 1st Schedule of the Accountants Act 1967; or

(iii) fulfils such other requirements as prescribed or approved by Bursa Malaysia Securities Berhad.

1.3 In the event of any vacancy in the Audit Committee resulting in the number of members being reduced to below three (3), the Board of Directors shall within three (3) months appoint such number of new members as may be required to make up the minimum number of three (3) members.

1.4 The Chairman of the Audit Committee shall be elected among the members of the Audit Committee and shall be an independent director.

1.5 No alternate director shall be appointed as a member of the Audit Committee. 1.6 The term of office and performance of the Audit Committee and each of its members shall be reviewed by

the Board at least once every three (3) years. 2.0 Quorum and Procedures of Meetings

2.1 Meetings shall be held not less than four (4) times in a financial year, although additional meetings may be called at any time by the Chairman upon the request of the external or the internal auditors or at the Chairman’s discretion.

2.2 The quorum of meetings of the Audit Committee shall consist of not less than two (2) members; the majority of the members present must be independent directors. In the absence of the Chairman, the members present shall elect a Chairman for the meeting from among the members present.

2.3 The Company Secretary shall act as Secretary of the Audit Committee.

2.4 The Audit Committee may, as and when deemed necessary, invite other Board members, senior management personnel, a representative of the external auditors and external independent professional advisers to attend the meetings.

2.5 The Audit Committee shall meet with the external auditors without the executive Board members’ present, at least twice in a financial year.

2.6 Minutes of each meeting shall be kept and distributed to each member of the Board.



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3.0 Authority 3.1 The Audit Committee is authorised by the Board to investigate any matter within its terms of reference.

It shall have the authority to seek any information it requires from any employee of the Group and all employees are directed to co-operate with any request made by the Audit Committee.

3.2 The Audit Committee shall have full and unrestricted access to any information pertaining to the Company

and the Group. 3.3 The Audit Committee shall have direct communication channels with the internal and external auditors,

and with the management of the Group, and shall be able to convene meetings with the external auditors, the internal auditors or both, excluding the attendance of other directors and employees of the Group, whenever deemed necessary.

3.4 The Audit Committee shall have the resources that are required to perform its duties. The Committee can

obtain, at the expense of the Company, external legal or other independent professional advice it considers necessary.

3.5 Where the Audit Committee is of the view that a matter reported by it to the Board has not been satisfactorily resolved resulting in a breach of the Listing Requirements, the Audit Committee shall promptly report such matter to Bursa Malaysia Securities Berhad.

4.0 Duties and Responsibilities The Audit Committee shall review and, where appropriate, report to the Board of Directors the following:

(a) Risk Management and Internal Control

• The adequacy and effectiveness of risk management, internal control and governance systems instituted in the Company and the Group

• The Group’s risk management policy and implementation of the risk management framework• The appointment or termination of members of the risk management committee• The report of the risk management committee

(b) Internal Audit

• The internal audit function will report directly to the Audit Committee• The adequacy of the internal audit scope and plan, functions, competency and resources of the

internal audit function and that it has the necessary authority to carry out its work• Any appraisal or assessment of the performance of members of the internal audit function, including

the Head of Internal Audit; and approve any appointment or termination of senior staff members of the internal audit function


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(c) External Audit

• The external auditors’ audit plan and scope of their audits, including any changes to the planned scope of the audit plan

• The external auditors’ audit report and their evaluation of the system of internal controls • The appointment and performance of external auditors, the audit fee and any question of resignation

or dismissal including any written explanations before making recommendations to the Board• The assistance given by the employees to the external auditors, and any difficulties encountered in

the course of the audit work

(d) Audit Reports

• Internal and external audit reports together with management’s responses to ensure that appropriate and prompt remedial action is taken by the management on major deficiencies in controls or procedures that are identified, including status of previous audit recommendations

• Findings of internal investigations and related management responses

(e) Financing Reporting

The quarterly results and the year end financial statements of the Company and the Group for recommendation to the Board of Directors for approval, focusing particularly on:

• changes in or implementation of accounting policies and practices• significant adjustments arising from the audit• significant and unusual events• going concern assumption• compliance with accounting standards and other legal requirements

(f ) Related Party Transactions

Any related party transaction and conflict of interest situation that may arise within the Company or the Group.

(g) Allocation of Share Options

Verification on the allocation of share options to ensure compliance with the criteria for allocation of share options pursuant to the share scheme for employees of the Group at the end of each financial year.

(h) Other Functions

Any such other functions as the Audit Committee considers appropriate or as authorised by the Board of Directors.



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SUMMARY OF ACTIVITIES

The Audit Committee had carried out the following activities during the financial year:

• Financial Results

a. Reviewed the quarterly unaudited financial results of the Group prior to recommending them for the Board’s approval.

b. Reviewed the annual financial statements of the Group with the external auditors prior to submission to the Board for their consideration and approval. The review was focusing particularly on changes of accounting policy, significant and unusual events and compliance with applicable approved accounting standards in Malaysia and other legal and regulatory requirements.

• Internal Audit

a. Reviewed the annual audit plan for adequacy of scope and coverage on the activities of the Group.

b. Reviewed the audit programmes, resource requirements for the year and assessed the performance of the internal audit function.

c. Reviewed the internal audit reports, audit recommendations made and management’s responses to these recommendations and actions taken to improve the system of internal control and procedures.

d. Monitored the implementation of the audit recommendations to ensure that all key risks and controls have

been addressed.

e. Reviewed the Control Self-Assessment ratings submitted by the respective operations management.

f. Reviewed the Statement on Internal Control to ensure that it is consistent with their understanding of the state of internal controls of the Group and recommended the same to the Board for inclusion in the Annual Report.

g. Reviewed and approved the Internal Audit Charter.

• External Audit

a. Reviewed with the external auditors:

• the audit planning memorandum, audit strategy and scope of work for the year• the results of the annual audit, their audit report and management letter together with management’s

responses to the findings of the external auditors b. Reviewed the performance of the external auditors and made recommendations to the Board on their

re-appointment and remuneration.


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c. Held two (2) discussions with the external auditors without the presence of management and executive Board members.

• Related Party Transactions

a. Reviewed the related party transactions entered into by the Group.

b. Reviewed the recurrent related party transactions of a revenue or trading nature on quarterly basis in accordance with the mandate given by shareholders.

INTERNAL AUDIT FUNCTION

The Group has an Internal Audit Division which is independent of the activities it audits. The costs incurred by the Division for the financial year was RM128,000.

The Division reports directly to the Audit Committee and assists the Committee in the discharge of its duties and functions. Its role is to provide independent and objective reports to the Board on the organisation’s management, operations, records, accounting policies and internal controls.

The Internal Audit Division presents its Internal Audit Plan, which includes the scope and functions of the Internal Audit for the financial year for consideration and approval of the Audit Committee at the beginning of the financial year. This Internal Audit Plan is subject to review at the quarterly meetings of the Audit Committee in response to changes in the operational, financial and control environment.

The scope of internal audit functions performed by the internal audit encompasses audit visits to all relevant subsidiaries of the Group on a regular basis. The objectives of such audit visits are to determine whether adequate controls have been established and are operating in the Group, to provide reasonable assurance that:

• business objectives and policies are adhered to• operations are cost effective and efficient• assets and resources are satisfactorily safeguarded and efficiently used• integrity of records and information is protected• applicable laws and regulations are complied with

The emphasis of such audit visits encompass critical areas of the Group such as revenue, cost of sales, expenditure, assets, internal controls, operating performance and financial statement review. Audit reports are issued to highlight any deficiency or findings requiring the management’s attention. Such reports also include practical and cost effective recommendations as well as proposed corrective actions to be adopted by the management. The audit reports and management’s responses are circulated to the Chief Executive Officer, Audit Committee and the Group Chairman for review and comments. Follow-up audits are then carried out to determine whether corrective actions have been taken by the management.



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Financial Statements

34 Directors’ Report

39 Statements of Financial Position

41 Statements of Comprehensive Income

43 Statements of Changes in Equity

45 Statements of Cash Flows

49 Notes to the Financial Statements

162 Statement by Directors

162 Statutory Declaration

163 Independent Auditors’ Report


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Directors’ Report

The directors have pleasure in submitting their report and the audited financial statements of the Group and of the Company for the financial year ended 31 March 2011.

Principal Activities

The principal activity of the Company is that of investment holding. The principal activities of the subsidiaries and associates are set out in Notes 45 and 46 to the financial statements respectively.

There have been no significant changes in the nature of the principal activities of the Company and those of the subsidiaries and associates during the financial year.

Change of Name

The Company changed its name from “AMDB Berhad” to “Amcorp Properties Berhad” with effect from 8 September 2010.

Financial Results

Group Company RM’000 RM’000

Profit for the year 50,987 75,736

Attributable to :- Owners of the Company 48,681 75,736 Minority interests 2,306 –

50,987 75,736

Reserves and Provisions

There were no material transfers made to or from reserves or provisions accounts during the financial year ended 31 March 2011 other than those disclosed in the financial statements.

Dividends

No dividend has been paid or declared since the end of the previous financial year. The directors do not recommend the payment of any dividends in respect of the current financial year.

Annual Report 2011

35

Share Capital

There were no issuance of shares during the financial year.

Treasury Shares

The shareholders of the Company, by a resolution passed at an annual general meeting held on 3 September 2010, had granted an approval to the Company to buy back its own shares of up to 10% of the issued and paid-up share capital of the Company.

During the financial year, the Company repurchased 2,350,600 of its ordinary shares of RM0.50 each listed and quoted on the Main Market of Bursa Malaysia Securities Berhad from the open market at an average buy-back price of RM0.40 per share. The total consideration paid, including transaction costs, of RM957,396 was financed by internally generated funds. The shares repurchased were held as treasury shares in accordance with Section 67A of the Companies Act, 1965.

The Company has the right to cancel, resell and/or distribute the treasury shares as dividends at a later date. As treasury shares, the rights attached to voting, dividends and participation in other distribution is suspended. None of the treasury shares repurchased had been sold or cancelled during the financial year.

As at 31 March 2011, the number of ordinary shares in issue after the share buy-back is 573,110,837 shares of RM0.50 each. Further relevant details are disclosed in Note 22 to the financial statements.

Immediate and Ultimate Holding Companies

The directors regard Amcorp Group Berhad as the immediate holding company and Clear Goal Sdn. Bhd. as the ultimate holding company, both of which are companies incorporated in Malaysia.

Directors

The names of directors in office since the date of the last Directors’ Report and at the date of this report are :-

Azmi Hashim Tan Sri Dato’ Chen Wing Sum Tan Sri Dato’ Lee Lam Thye Dato’ AB. Halim bin Mohyiddin Dato’ Gan Nyap Liou @ Gan Nyap Liow Dato’ Che Md Nawawi bin Ismail Soo Kim Wai Shalina Azman Shahman Azman Lee Keen Pong P’ng Soo Theng

Directors’ Report


36

Directors’ Interests

Particulars of directors’ interests in ordinary shares in the Company as shown in the Registers as at the end of the financial year are as follows :-

Number of ordinary shares of RM0.50 each As at As at 01-04-2010 Acquired Disposed 31-03-2011

Azmi Hashim - Direct 17,667 – – 17,667

Tan Sri Dato’ Lee Lam Thye - Indirect 150,000 – – 150,000

Particulars of directors’ interests in ordinary shares and options to subscribe for ordinary shares under the Employees’ Share Option Scheme (“ESOS”) of a fellow subsidiary, namely MCM Technologies Berhad, as at the end of the financial year are as follows :-

Number of ordinary shares of RM0.10 each in MCM Technologies Berhad As at As at 01-04-2010 Acquired Disposed (1) 31-03-2011

Dato’ AB. Halim bin Mohyiddin 200,000 – (200,000) –

Soo Kim Wai 200,000 – (200,000) –

Lee Keen Pong 200,000 – (200,000) –

ESOS expiring on 13 October 2014 Number of options over ordinary shares of RM0.10 each in MCM Technologies Berhad As at As at 01-04-2010 Granted Terminated 31-03-2011

Dato’ AB. Halim bin Mohyiddin 600,000 – (600,000) –

Shalina Azman 600,000 – (600,000) –

Soo Kim Wai 600,000 – (600,000) –

Lee Keen Pong 600,000 – (600,000) –

(1) Disposed upon the acceptance of the Conditional Voluntary Take-Over Offer by Mezzanine Capital (Malaysia) Sdn Bhd (“MCSB”) to acquire all the remaining ordinary shares in MCM Technologies Berhad not already owned by MCSB on 13 December 2010.

Other than as disclosed above, no other directors in office at the end of the financial year held any interest, direct or indirect, in shares and debentures of the Company and its related corporations.

Directors’ Report

Annual Report 2011

37

Directors’ Report

Directors’ Benefits

Since the end of the previous financial year, none of the directors of the Company has received or become entitled to receive any benefits (other than those disclosed as directors’ remuneration in the financial statements) by reason of a contract made by the Company or a related corporation with any director or with a firm of which a director is a member or with a company in which the director has a substantial financial interest other than by virtue of transactions entered into in the ordinary course of business and as disclosed in Note 41 to the financial statements.

Except for the share options granted under the ESOS of MCM Technologies Berhad, which have been terminated on 7 November 2010, neither at the end of the financial year nor at any time during the financial year did there subsist any arrangements of which the Company or a related corporation is a party, whereby the directors might acquire benefits by means of the acquisition of shares in, or debentures of the Company or any other body corporate.

Other Statutory Information

(a) In the opinion of the directors :-

(i) the results of the operations of the Group and of the Company during the financial year have not been substantially affected by any item, transaction or event of a material and unusual nature;

(ii) no item, transaction or event of a material and unusual nature has arisen in the interval between the end of the financial year and the date of this report which is likely to affect substantially the results of the operations of the Group and of the Company for the financial year in which this report is made; and

(iii) no contingent or other liability has become enforceable, or is likely to become enforceable within the period of twelve months after the end of the financial year which will or may substantially affect the ability of the Group and of the Company to meet their obligations when they fall due.

(b) Before the financial statements of the Group and of the Company were made out, the directors took reasonable steps :-

(i) to ascertain that proper action had been taken in relation to the writing off of bad debts and the making of allowance for doubtful debts and satisfied themselves that all known bad debts had been written off and that adequate allowance had been made for doubtful debts; and

(ii) to ensure that any current assets which were unlikely to realise in the ordinary course of business including their value as shown in the accounting records of the Group and of the Company had been written down to an amount which they might be expected so to realise.


38

Other Statutory Information (Cont’d) (c) At the date of this report, the directors are not aware of any circumstances :-

(i) which would render the amount written off for bad debts and allowance made for doubtful debts in the Group and in the Company inadequate to any substantial extent;

(ii) which would render the values of current assets in the financial statements of the Group and of the Company misleading;

(iii) which have arisen which would render adherence to the existing method of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate; and

(iv) not otherwise dealt with in this report or the financial statements of the Group and of the Company which would render any amount stated in the financial statements misleading.

(d) At the date of this report, there does not exist :-

(i) any charge on the assets of the Group and of the Company which has arisen since the end of the financial year which secures the liabilities of any other person; or

(ii) any contingent liabilities in respect of the Group and of the Company which have arisen since the end of the financial year.

Auditors

The auditors, Messrs. Folks DFK & Co. retire and do not seek re-appointment.

Signed in accordance with a resolution of the Board of Directors,

AZMI HASHIM LEE KEEN PONGExecutive Chairman Executive Director / Chief Executive Officer

Petaling Jaya,23 June 2011

Directors’ Report

Annual Report 2011

39

Statements of Financial Positionas at 31 March 2011

Group Company Restated 2011 2010 2011 2010 Note RM’000 RM’000 RM’000 RM’000

ASSETS

Non-Current AssetsProperty, plant and equipment 4 34,766 36,753 1,878 1,428Investment properties 5 293,084 261,893 – –Investments in subsidiaries 6 – – 396,692 142,627Investments in associates 7 126,967 147,825 126,128 138,128Other investments 8 7,336 6,327 933 646Biological assets 10 3,846 2,818 – –Land held for property development 11 188,082 141,993 – –Long term receivables 12 15,117 25,742 – –Deferred tax assets 13 6,063 6,335 – –

675,261 629,686 525,631 282,829

Current AssetsProperty development costs 14 165,961 164,627 – –Inventories 15 13,040 18,204 – –Trade receivables 16 39,144 66,878 – 25Other receivables 17 17,029 3,161 169,018 339,084Accrued billings in respect of property development 1,266 4,064 – –Amount due from contract customers 18 2,181 2,090 – –Tax recoverable 11,673 14,823 6,939 7,604 Deposits, cash and bank balances 19 40,731 39,513 845 61

291,025 313,360 176,802 346,774

Total Assets 966,286 943,046 702,433 629,603


40

Group Company Restated 2011 2010 2011 2010 Note RM’000 RM’000 RM’000 RM’000

EQUITY AND LIABILITIES

Equity Attributable to Owners of the CompanyShare capital 21 287,731 287,731 287,731 287,731Treasury shares 22 (957) – (957) –Reserves 23 283,659 237,477 195,578 119,560

570,433 525,208 482,352 407,291Minority Interests 17,194 15,981 – –

Total Equity 587,627 541,189 482,352 407,291

Non-Current LiabilitiesBank borrowings 24 179,669 179,231 – –Hire purchase creditors 25 1,290 879 893 457Long term payables 26 2,648 48,593 – –Deferred tax liabilities 13 2,463 479 – –

186,070 229,182 893 457

Current LiabilitiesTrade payables 28 43,137 64,459 – –Other payables 29 50,089 16,423 138,407 152,696Progress billings in respect of property development 1,585 832 – –Amount due to contract customers 18 5,090 5,371 – –Bank borrowings :- Bank overdrafts 24 10,077 4,852 7,680 607- Other borrowings 24 79,093 79,087 72,782 68,330Hire purchase creditors 25 542 551 319 222Taxation 2,976 1,100 – –

192,589 172,675 219,188 221,855

Total Liabilities 378,659 401,857 220,081 222,312

Total Equity and Liabilities 966,286 943,046 702,433 629,603

The notes set out on pages 49 to 161 form an integral part of the financial statements.

Statements of Financial Positionas at 31 March 2011

Annual Report 2011

41

Statements of Comprehensive Incomefor the year ended 31 March 2011

Group Company 2011 2010 2011 2010 Note RM’000 RM’000 RM’000 RM’000

Continuing OperationsRevenue 30.1 110,111 240,702 17,085 17,216Cost of sales 30.2 (68,537) (204,417) – –

Gross profit 41,574 36,285 17,085 17,216

Other operating income 61,577 25,775 85,401 137,742Distribution expenses (1,842) (2,042) – –Administrative expenses (28,337) (28,943) (20,513) (19,051)Other operating expenses (18,019) (10,361) (715) (128,065)

Operating profit 31 54,953 20,714 81,258 7,842Finance costs 34 (17,820) (16,481) (5,244) (5,525)Share of results of associates 15,198 14,644 – –

Profit before taxation 52,331 18,877 76,014 2,317Taxation 35 (1,344) 13,019 (278) 3,668

Profit for the year from continuing operations 50,987 31,896 75,736 5,985

Discontinued OperationsProfit for the year from discontinued operations 20 – 4,024 – –

Profit for the Year 50,987 35,920 75,736 5,985

Other Comprehensive Income/(Expense) (1)

Foreign currency translations (2,186) (9,159) – –Fair value changes in available-for-sale financial assets 372 – 123 –Share of other comprehensive expenses of associates (638) (1,004) – –

Other comprehensive (expense)/income (2,452) (10,163) 123 –

Total Comprehensive Income 48,535 25,757 75,859 5,985

(1) There is no income tax attributable to the components of other comprehensive income/(expense)


42

Group Company 2011 2010 2011 2010 Note RM’000 RM’000 RM’000 RM’000

Profit for the year attributable to :Owners of the Company 48,681 33,660 75,736 5,985Minority interests 2,306 2,260 – –

50,987 35,920 75,736 5,985

Total comprehensive income attributable to :Owners of the Company 46,244 23,697 75,859 5,985Minority interests 2,291 2,060 – –

48,535 25,757 75,859 5,985

Earnings per share attributable to owners of the Company (sen)Basic, for profit from continuing operations 36.1 8.47 6.09 Basic, for profit from discontinued operations 36.1 – 0.83

Basic, for profit for the year 36.1 8.47 6.92

Diluted, for profit from continuing operations 36.2 8.47 6.09Diluted, for profit from discontinued operations 36.2 – 0.83

Diluted, for profit for the year 36.2 8.47 6.92


Statements of Comprehensive Incomeas at 31 March 2011

Annual Report 2011

43

Statements of Changes in Equityfor the year ended 31 March 2011

Attributable to owners of the Company Non-distributable Distributable (Accumulated Exchange losses)/ Share Share Capital translation Retained Minority Total capital premium reserve reserve profits Total interests equity RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group

Balance at 1 April 2009 477,341 142,269 10,416 3,134 (260,162) 372,998 2,855 375,853

Total comprehensive income – – – (9,963) 33,660 23,697 2,060 25,757

Capital reduction (Notes 21 and 23) (318,227) (38,323) – – 356,550 – – –Issue of shares (Notes 6.2.2(a), 21 and 23) 128,617 (104) – – – 128,513 – 128,513Acquisition of minority interest (Note 6.2.3) – – – – – – (1,218) (1,218)Acquisition of subsidiaries (Note 6.2.2) – – – – – – 13,390 13,390Realisation of capital reserve (Note 23.1) – – (9,535) – 9,535 – – –Dividend to minority interests – – – – – – (1,106) (1,106)

Balance at 31 March 2010 287,731 103,842 881 (6,829) 139,583 525,208 15,981 541,189

Attributable to owners of the Company Non-distributable Distributable Exchange Share Share Treasury Capital translation Fair value Retained Minority Total capital premium shares reserve reserve reserve profits Total interests equity RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Group

Balance at 1 April 2010 287,731 103,842 – 881 (6,829) – 139,583 525,208 15,981 541,189Effects of the adoption of FRS 139 (Note 2.2(e)) – – – – – 636 (698) (62) (251) (313)

287,731 103,842 – 881 (6,829) 636 138,885 525,146 15,730 540,876

Total comprehensive income – – – – (2,809) 372 48,681 46,244 2,291 48,535

Shares repurchased – – (957) – – – – (957) – (957)Dividend to minority interests – – – – – – – – (827) (827)

Balance at 31 March 2011 287,731 103,842 (957) 881 (9,638) 1,008 187,566 570,433 17,194 587,627


44

Attributable to owners of the Company Non-distributable Distributable (Accumulated losses)/ Share Share Capital Retained capital premium reserve profits Total RM’000 RM’000 RM’000 RM’000 RM’000

Company Balance at 1 April 2009 477,341 142,269 9,535 (356,352) 272,793

Total comprehensive income – – – 5,985 5,985

Capital reduction (Notes 21 and 23) (318,227) (38,323) – 356,550 –Issue of shares (Notes 6.2.2(a), 21 and 23) 128,617 (104) – – 128,513Realisation of capital reserve (Note 23.1) – – (9,535) 9,535 –

Balance at 31 March 2010 287,731 103,842 – 15,718 407,291

Attributable to owners of the Company Non-distributable Distributable Share Share Treasury Fair value Retained capital premium shares reserve profits Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Company

Balance at 1 April 2010 287,731 103,842 – – 15,718 407,291Effects of the adoption of FRS 139 (Note 2.2(e)) – – – 159 – 159

287,731 103,842 – 159 15,718 407,450

Total comprehensive income – – – 123 75,736 75,859

Shares repurchased – – (957) – – (957)

Balance at 31 March 2011 287,731 103,842 (957) 282 91,454 482,352


Statements of Changes in Equityfor the year ended 31 March 2011

Annual Report 2011

45

Statements of Cash Flowsfor the year ended 31 March 2011

Group Company Restated 2011 2010 2011 2010 RM’000 RM’000 RM’000 RM’000

Cash Flows from Operating Activities

Profit before taxation :- from continuing operations 52,331 18,877 76,014 2,317- from discontinued operations – 3,963 – –

52,331 22,840 76,014 2,317Adjustments for :-Share of results of associates (15,198) (14,644) – –Curtailment of retirement benefit scheme – (630) – (630)Write back of impairment loss on :- land held for property development (45,677) – – –- trade and other receivables (177) (4,189) (2) (3,238)- advances to subsidiaries – – (40,000) (49,802)Write back of accrued development costs (8,833) – – –Impairment loss on :- property, plant and equipment 94 – – –- investments in subsidiaries – – – 56,797- unquoted investment classified as available-for-sale financial assets – 2 – –- property development cost 365 – – –- trade and other receivables 222 2,124 25 –- advances to subsidiaries – – – 1,000Property, plant and equipment written off 48 187 2 19Investments in subsidiaries written off – – 610 –Bad debts written off :- advances to subsidiaries – – 1,502 3,402- others 315 1,060 – 980Write-down in value of inventories 73 – – –(Gain)/Loss on disposal of property, plant and equipment and leasehold land (1,805) 830 81 1,178Gain on disposal of subsidiaries – (3,462) – (10,667)Loss/(Gain) on disposal of associates 10,324 (13,941) (6,650) (20,639)Loss/(Gain) on disposal of investments classified as available-for-sale financial assets :- quoted investments – (65) – 28- unquoted investments 9 (11) – –Depreciation of property, plant and equipment 2,314 1,649 281 473Depreciation of investment properties 3,562 1,600 – –Excess of fair value of identifiable assets and liabilities recognised to profit or loss – (1,753) – –


46


Cash Flows from Operating Activities (Cont’d)

Waiver of debts by subsidiaries – – (31,642) (5,711)Loss on redemption of redeemable preference shares of a subsidiary – – – 35,460Dividend income (101) (232) (17,085) (17,216)Unrealised gain on foreign exchange (45) (328) – –Unrealised loss on foreign exchange 1,282 2,789 – –Interest income (731) (1,344) (6,744) (8,167)Interest expense 17,515 16,494 5,244 5,525Accretion of interest implicit in long term receivables (690) – – –Accretion of interest implicit in long term payables 305 – – –

Operating profit/(loss) before working capital changes 15,502 8,976 (18,364) (8,891)

Increase in biological assets (1,028) (1,095) – –(Increase)/Decrease in land held for development (412) 95 – –(Increase)/Decrease in property development costs (1,699) 47,542 – –Decrease/(Increase) in inventories 5,091 (5,995) – –Decrease in trade and other receivables 32,911 38,455 26 3,533(Decrease)/Increase in trade and other payables (18,228) (66,751) 556 (2,357)(Increase)/Decrease in amount due from subsidiaries – – (6,720) 26,419Increase/(Decrease) in amount owing to subsidiaries – – 16,797 (50,452)

Cash generated from/(utilised in) operations 32,137 21,227 (7,705) (31,748)

Net tax refunded 5,892 13,678 4,421 11,867Interest received 731 1,344 2 8,167Interest paid (17,730) (16,495) (5,128) (5,525)

Net cash from/(used in) operating activities 21,030 19,754 (8,410) (17,239)


Annual Report 2011

47


Cash Flows from Investing ActivitiesNet cash outflow on acquisition of subsidiaries (Note 6.2.2(a)) – (49,907) – (909)Net cash inflow on disposal of subsidiaries (Notes 6.3.2 and 20(c)) – 13,286 – 15,400Purchase of an investment property and deposit paid (47,128) (300,519) – –Proceeds from disposal of other quoted and unquoted investments 5 7,712 – 2,474Proceeds from disposal of property, plant and equipment and leasehold land 3,159 10,348 220 9,246Proceeds from disposal of associates 18,650 53,950 18,650 22,700Proceeds from redemption of redeemable preference shares in a subsidiary – – – 3,940Acquisition of shares from minority shareholders (Note 6.2.3) – (1,440) – (1,440)Purchase of other quoted and unquoted investments – (10,072) – –Purchase of property, plant and equipment (Note 37) (725) (1,429) (136) (81)Subscription to ordinary shares and redeemable convertible preference shares of subsidiaries (Notes 6.2.4 and 6.2.5) – – (32,789) (91,113)Dividends received - quoted 81 231 40 181Dividends received - associates 6,445 4,028 6,445 2,278Dividends received - subsidiaries – – 6,561 10,842

Net cash used in investing activities (19,513) (273,812) (1,009) (26,482)

Cash Flows from Financing ActivitiesShares repurchased (957) – (957) –Share issue expenses – (104) – (104)Net bank borrowings obtained 2,933 226,640 4,452 46,030Net loan (repaid to)/obtained from minority shareholders (5,570) 46,370 – –Net hire purchase and lease financing repaid (716) (741) (365) (286)Dividends paid to minority shareholders in subsidiaries (827) (1,106) – –

Net cash (used in)/from financing activities (5,137) 271,059 3,130 45,640



48



Net (Decrease)/Increase in Cash and Cash Equivalents (3,620) 17,001 (6,289) 1,919

Cash and cash equivalents at beginning of year 34,661 19,120 (546) (2,465)

Effect of exchange rates on cash and cash equivalents (387) (1,460) – –

Cash and Cash Equivalents at End of Year 30,654 34,661 (6,835) (546)

Cash and cash equivalents at end of year comprised :-Deposits, cash and bank balances (Note 19) 40,731 39,513 845 61Bank overdrafts (Note 24) (10,077) (4,852) (7,680) (607)

30,654 34,661 (6,835) (546)


Annual Report 2011

49

Notes to the Financial Statementsat 31 March 2011

1. Corporate Information

Amcorp Properties Berhad (formerly known as AMDB Berhad) is a public company limited by shares, incorporated and domiciled in Malaysia. The Company is listed on the Main Market of Bursa Malaysia Securities Berhad. The Company changed its name from “AMDB Berhad” to “Amcorp Properties Berhad” with effect from 8 September 2010.

Its registered office is located at Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur and the principal place of business is located at 2.01, PJ Tower, AMCORP Trade Centre, No. 18 Jalan Persiaran Barat, 46050 Petaling Jaya, Selangor.

The immediate holding company is Amcorp Group Berhad and the ultimate holding company is Clear Goal Sdn. Bhd., both of which are companies incorporated in Malaysia.

The principal activity of the Company is that of investment holding. The principal activities of the subsidiaries and associates are set out in Notes 45 and 46 to the financial statements respectively.

The financial statements are presented in Ringgit Malaysia (“RM”). All financial information presented in RM has been rounded to the nearest thousand, unless otherwise stated.

The financial statements were authorised for issue by the Board of Directors on 23 June 2011.

2. Summary of Significant Accounting Policies

2.1 Basis of Preparation

The financial statements of the Group and of the Company are prepared under the historical cost convention unless otherwise indicated in this summary of significant accounting policies. The financial statements comply with Financial Reporting Standards and the provisions of the Companies Act, 1965 in Malaysia.

The Group and the Company have adopted the new and revised Financial Reporting Standards (“FRSs”), Issues Committee (“IC”) Interpretations and amendments to FRSs and IC Interpretations issued by the Malaysian Accounting Standards Board (“MASB”), as set out in Note 2.2 below, which are effective from the beginning of the current financial year.


50


2. Summary of Significant Accounting Policies (Cont’d)

2.2 New and Revised FRSs, IC Interpretations and Amendments to FRSs and IC Interpretations Adopted by the Group

The accounting policies adopted by the Group and the Company are consistent with those applied in the previous financial year other than the adoption of the following new and revised FRSs, IC Interpretations and amendments to FRSs and IC Interpretations issued by the Malaysian Accounting Standard Board (“MASB”). Those FRSs, IC Interpretations and amendments which are relevant to the operations of the Group and the Company and which are effective from the beginning of the current financial year are as follows :-

New and Revised FRSs and InterpretationsFRS 7 Financial Instruments : DisclosuresFRS 8 Operating SegmentsFRS 101 Presentation of Financial Statements (Revised)FRS 123 Borrowing Costs (Revised)FRS 139 Financial Instruments : Recognition and MeasurementIC Interpretation 9 Reassessment of Embedded DerivativesIC Interpretation 10 Interim Financial Reporting and ImpairmentIC Interpretation 11 FRS 2 - Group and Treasury Share Transactions

Amendments to FRSs and InterpretationsFRS 2 Share-based Payment - Vesting Conditions and CancellationsFRS 7 Financial Instruments : DisclosuresFRS 127 Consolidated and Separate Financial Statements : Cost of an Investment in a Subsidiary, Jointly Controlled Entity and AssociateFRS 132 Financial Instruments : Presentation - Puttable Financial Instruments and Obligations Arising on Liquidation - Component Part Classification for a Compound Financial Instrument - Classification of Right IssuesFRS 139 Financial Instruments : Recognition and MeasurementIC Interpretation 9 Reassessment of Embedded DerivativesAmendments to FRSs Classified as “Improvement to FRSs (2009)”

The adoption of the above FRSs, IC Interpretations and amendments to FRSs and Interpretations did not give rise to any material effects on the results and financial position of the Group and of the Company nor any significant changes in the presentation and disclosure of amounts in the financial statements other than as disclosed below.

Annual Report 2011

51



2.2 New and Revised FRSs, IC Interpretations and Amendments to FRSs and IC Interpretations Adopted by the Group (Cont’d)

(a) FRS 7, Financial Instruments : Disclosures

Prior to 1 April 2010, the disclosure of information about factors that affect the amount, timing and certainty of an entity’s future cash flows relating to financial instruments was made in accordance with the requirements of FRS 132, Financial Instruments : Disclosure and Presentation. FRS 7 supersedes the disclosure requirements of FRS 132 and introduces enhanced disclosures on financial instruments. It requires disclosure of the significance of financial instruments for an entity’s financial position and performance and the qualitative and quantitative information about exposure to risks arising from financial instruments, including specified minimum disclosures about credit risk, liquidity risk and market risk.

The Group and the Company have applied FRS 7 prospectively in accordance with the transitional provisions of the standard. Accordingly, certain comparative information for the new disclosures have not been presented. As the changes affect only the disclosures, there is no impact on the Group’s and the Company’s financial position and results.

(b) FRS 8, Operating Segments

FRS 8 which replaces FRS 1142004 : Segment Reporting, specifies how an entity should report information about its operating segments. The standard requires identification of operating segments on the basis of internal reports that are regularly reviewed by the entity’s chief operating decision maker in order to allocate resources to the segments and assess their performances. The standard also requires the disclosures, based on available information, about the revenue derived by the entity from its products and services, the countries in which it earns revenue and holds assets and about the entity’s major customer.

FRS 8 has been adopted retrospectively by the Group. The operating segments determined in accordance with FRS 8 are the same as the business segments previously identified under FRS 1142004.


52




(c) FRS 101, Presentation of Financial Statements (Revised)

The revised FRS 101 introduces changes to the overall requirements for the presentation of financial statements, guidelines for their structure and minimum requirements for their content.

The revised standard requires presentation of all owner changes in equity in the statement of changes in equity and all non-owner changes in equity to be presented separately in one statement of comprehensive income or in two linked statements. The Group has elected for the single statement presentation.

The standard also requires a statement of financial position as at the beginning of the earliest comparative period when there is a change in accounting policy retrospectively or when there is retrospective restatement or reclassification of items in the financial statements.

In addition, the revised FRS 101 requires new disclosure of information that enables users of the financial statements to evaluate the Group’s objectives, policies and processes for managing capital.

The Group and the Company have adopted the revised FRS 101 retrospectively. Since the changes affect only the presentation aspects, there is no impact on the financial position and results of the Group and of the Company.

(d) Amendment to FRS 117, Leases (Amendments to FRSs Classified as “Improvement to FRSs (2009)”)

Prior to the adoption of the Amendment to FRS 117, leasehold land that normally had an indefinite economic life and where title was not expected to pass to the lessee by the end of the lease term was treated as an operating lease. Payment made on entering into or acquiring a leasehold land was accounted for as prepaid lease payments that were amortised over the lease term in accordance with the pattern of benefits provided.

Following the adoption of the Amendment to FRS 117, the Group had reassessed and determined that the Group’s leasehold land are in substance a finance lease and has classified its leasehold land from prepaid lease payments to property, plant and equipment.

The reclassification has been made retrospectively and does not affect the Group’s results for the current and previous financial years nor its financial position as at the end of the current and previous reporting period.

Annual Report 2011

53




(d) Amendment to FRS 117, Leases (Amendments to FRSs Classified as “Improvement to FRSs (2009)”) (Cont’d)

The effects of the reclassification on the Group’s statement of financial position as at 31 March 2010 and 1 April 2009 are as follows :-

Effects of As the adoption previously of Amendment As reported to FRS 117 restated RM’000 RM’000 RM’000

31 March 2010 Property, plant and equipment 36,631 122 36,753 Prepaid lease payments 122 (122) –

1 April 2009 Property, plant and equipment 37,733 971 38,704 Prepaid lease payments 971 (971) –

The Group has not presented the statement of financial position as at the beginning of the earliest comparative period which is as at 1 April 2009 as required by FRS 101, Presentation of Financial Statements, as the above reflects only a reclassification of non-current assets and has no significant impact on the Group’s financial position as a whole.

(e) FRS 139, Financial Instruments : Recognition and Measurement

FRS 139 establishes principles for recognising and measuring financial assets, financial liabilities and some contracts to buy or sell non-financial items. Hedge accounting is permitted only under strict circumstances. The Group has adopted FRS 139 prospectively beginning from 1 April 2010 in accordance with transitional provisions of the standard. The effects on the adoption of FRS 139 have been accounted for by adjusting the opening retained profits as at 1 April 2010. Comparatives are not restated.


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(e) FRS 139, Financial Instruments : Recognition and Measurement (Cont’d)

The adoption of FRS 139 has resulted in changes to accounting policies relating to recognition and measurement of the Group’s financial instruments as described below :-

(i) Investments in non-current equity and debt instruments

Prior to 1 April 2010, non-current investments in equity and debt instruments, other than investments in subsidiaries and associates, that were not held for trading purposes were stated at cost less allowance for diminution in value which was other than temporary in nature.

Upon the adoption of FRS 139, such investments are now categorised and measured as available-for-sale financial assets as detailed in Note 2.17(b). Accordingly, the investments in quoted instruments held by the Group and the Company as at 1 April 2010 had been restated at their fair value as of that date and the resulting increase in carrying amount of RM635,575 and RM158,775 for the Group and the Company respectively was adjusted to the fair value reserve as at 1 April 2010. The unquoted equity and debt instruments where the fair value cannot be reliably measured continue to be carried at cost less impairment loss.

(ii) Trade and other receivables and payables

Prior to 1 April 2010, trade and other receivables and payables, including retention sums receivable and payable, were stated at their respective amounts receivable and payable and in the case of receivables, less allowance for doubtful debts.

With the adoption of FRS139, such receivables and payables are now initially measured at fair value, plus directly attributable transaction costs and subsequently measured at amortised cost using the effective interest method. The Group has remeasured its receivables and payables as at 1 April 2010 at amortised cost using the effective interest method and the remeasurement has resulted in a net decrease to the opening retained profits of the Group as at 1 April 2010.

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(iii) Impairment of trade and other receivables

Prior to 1 April 2010, an allowance for doubtful debts was made when a debt was considered to be doubtful of collection. Upon the adoption of FRS 139, an impairment loss is recognised when there is objective evidence that an impairment loss has been incurred. The amount of impairment loss is measured as the difference between the receivable’s carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the receivable’s original effective interest rate. The Group has reassessed the allowance for impairment loss as at 1 April 2010 in accordance with FRS 139 and determined that there is no difference with the amount recognised previously.

The effects on adoption of FRS 139 on the financial statements of the Group and of the Company are as follows :-

Statements of financial position Increase / (Decrease) As at As at 31.03.2011 01.04.2010 RM’000 RM’000

Group

Non-current assets Other investments 1,008 636Long term receivables (1,216) (1,556)

Non-current liabilitiesLong term payables (678) (607)

EquityExchange translation reserve 56 –Fair value reserve 1,008 636Retained profits (228) (698)Minority interests (365) (251)


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Statements of financial position (Cont’d) Increase / (Decrease) As at As at 31.03.2011 01.04.2010 RM’000 RM’000

Company

Non-current assets Other investments 282 159

EquityFair value reserve 282 159

Statements of comprehensive income for the year ended 31 March 2011

Increase / (Decrease) Group Company RM’000 RM’000

Profit for the year 346 –Other comprehensive income for the year, net of tax :- Foreign currency translations 66 –- Fair value changes in available-for-sale financial assets 372 282

Total comprehensive income 784 282

Total comprehensive income attributable to :-Owners of the Company 898 282Minority interests (114) –

784 282

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2.3 New and Revised FRSs, IC Interpretations and Amendments to FRSs and IC Interpretations That Are Not Yet Effective and Have Not Been Early Adopted

As at the date of issuance of the financial statements, certain new and revised FRSs, IC Interpretations

and amendments to FRSs and IC Interpretations have been issued by the MASB but not yet effective until future periods. Those FRSs, IC Interpretations and amendments which are relevant to the operations of the Group and the Company are as follows :-

Effective for financial period beginning on or afterNew and Revised FRSs and InterpretationsFRS 3 Business Combinations (Revised) 1 July 2010FRS 124 Related Party Disclosures 1 January 2012FRS 127 Consolidated and Separate Financial Statements (Revised) 1 July 2010IC Interpretation 4 Determining whether an Arrangement contains a Lease 1 January 2011IC Interpretation 15 Agreements for the Construction of Real Estate 1 January 2012IC Interpretation 17 Distribution of Non-cash Assets to Owners 1 July 2010IC Interpretation 18 Transfer of Assets from Customers 1 January 2011IC Interpretation 19 Extinguishing Financial Liabilities with Equity Instruments 1 July 2011

Amendments to FRSs and InterpretationsFRS 2 Share-based Payment : - Scope of FRS 2 and revised FRS 3 1 July 2010 - Group Cash-settled Share-based Payment Transactions 1 January 2011FRS 5 Non-current Assets Held for Sale and Discontinued 1 July 2010 Operations - Plan to sell the controlling interest in a subsidiaryFRS 7 Improving Disclosures about Financial Instruments 1 January 2011 (Amendments to FRS 7)FRS 138 Intangible Assets - Additional consequential amendments 1 July 2010 arising from revised FRS 3IC Interpretation 9 Reassessment of Embedded Derivatives - Scope of 1 July 2010 IC Interpretation 9 and revised FRS 3Amendments to FRSs Classified as “Improvement to FRSs (2010)” 1 January 2011


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2.3 New and Revised FRSs, IC Interpretations and Amendments to FRSs and IC Interpretations That Are Not Yet Effective and Have Not Been Early Adopted (Cont’d)

The Group will adopt the above FRSs, IC Interpretations and the relevant amendments when they become effective and they are not expected to have any significant impact on the financial statements of the Group and of the Company upon their initial application other than as discussed below :-

(a) FRS 3, Business Combinations (Revised)

The revised FRS 3 will result in a change in the accounting for business combinations occurring on or after 1 July 2010. The principal changes are as follows :-

• Thedefinitions of a“business” and a“business combination” havebeen amended andadditional guidance was added for identifying when a group of assets constitutes a business.

• Minorityinterest(whichwillbeknownasnon-controllinginterest)mustbemeasuredeitherat fair value or at its proportionate share of the acquiree’s net identifiable assets.

• Therecognitionofcontingenciesacquiredinabusinesscombinationthatdonotmeetthedefinition of a liability is no longer permitted.

• Costsincurredinconnectionwithabusinesscombinationmustbeaccountedforseparatelyfrom the business combination, which usually means that they are recognised as expenses rather than included in goodwill.

• Contingentconsiderationwillbemeasuredandrecognisedatfairvalueattheacquisitiondate and subsequent changes in fair value of contingent considerations classified as liabilities are recognised in accordance with FRS 139, FRS 137 or other FRSs as appropriate, rather than by adjusting goodwill.

The Group will adopt the revised FRS 3 prospectively in accordance with the transitional provisions of the revised standard to business combinations for which the acquisition date is on or after 1 July 2010.

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2.3 New and Revised FRSs, IC Interpretations and Amendments to FRSs and IC Interpretations That Are Not Yet Effective and Have Not Been Early Adopted (Cont’d)

(b) FRS 127, Consolidated and Separate Financial Statements (Revised)

The main amendments made to FRS 127 are as follows :-

• Theterm“minorityinterest”willbereplacedbytheterm“non-controllinginterest”.

• Thetotalcomprehensiveincomeshallbeattributedtotheownersoftheparentandtothenon-controlling interest even if this results in the non-controlling interest having a deficit balance. Currently, excess losses are allocated to the owners of the parent, except to the extent that the non-controlling interest had a binding obligation and was able to make an additional investment to cover the losses.

• Changesinaparent’sownershipinterestinasubsidiarythatdonotresult inthelossofcontrol shall be accounted for as equity transactions. There is no requirements for such transactions in the current FRS.

The application of the revised FRS 127 is not expected to have a material impact on the Group.

(c) IC Interpretation 15, Agreements for the Construction of Real Estate

The adoption of IC Interpretation 15 will result in a change in accounting policy for revenue recognition from property development activities. The Group is required to revisit its arrangement with buyers to determine its accounting policy on revenue recognition. The impact of IC Interpretation 15 cannot be reasonably estimated due to the uncertainties surrounding the expectation of future sales and fluctuation of development cost.

2.4 Basis of Consolidation

The consolidated financial statements include the financial statements of the Company and all its subsidiaries made up to the end of the reporting period. The financial statements of the subsidiaries are prepared for the same reporting date as the Company.

Subsidiaries are those entities in which the Group has the power to exercise control over the financial and operating policies so as to obtain benefits from their activities. In assessing control, the existence and effect of potential voting rights that are currently exercisable or convertible are taken into account. Subsidiaries are consolidated from the date of acquisition, being the date on which the Group obtains control and continue to be consolidated until the date that such control ceases.

Acquisitions of subsidiaries are accounted for using the purchase method of accounting. Under the purchase method, the cost of an acquisition is measured as the aggregate of the fair values, at the date of exchange, of the assets given, liabilities incurred or assumed, and equity instruments issued, plus any costs directly attributable to the acquisition.


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2.4 Basis of Consolidation (Cont’d)

Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, except for non-current assets that are classified as held for sale which shall be recognised at fair value less costs to sell. The excess of the cost of acquisition over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities represents goodwill. The excess of the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of acquisition is recognised immediately in profit or loss.

Minority interest represents that portion of profit or loss and net assets of a subsidiary attributable to equity interest that are not held by the Group. Minority interest is measured at the minority’s share of the fair value of the identifiable assets and liabilities of the subsidiary at the acquisition date and the minority’s share of changes in the subsidiary’s equity since then.

Where losses applicable to the minority exceed the minority’s interest in the equity of a subsidiary, the excess and any further losses applicable to the minority are charged against the Group’s interest except to the extent that the minority has a binding obligation to, and is able to, make additional investment to cover the losses. If the subsidiary subsequently reports profits, the Group’s interest is allocated all such profit until the minority’s share of losses previously absorbed by the Group has been recovered.

Intra-group balances and transactions and the resulting unrealised profits are eliminated on consolidation. Unrealised losses are eliminated on consolidation and the relevant assets are assessed for impairment. The consolidated financial statements reflect transactions and balances with external parties only.

2.5 Goodwill on Consolidation

Goodwill arising on the acquisition of a subsidiary represents the excess of the cost of the acquisition over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the subsidiary recognised at the date of acquisition. Goodwill is recognised as an asset and is measured at cost less accumulated impairment losses. Goodwill is tested for impairment annually or more frequently if events or changes in circumstances indicate that the carrying value may be impaired. For the purpose of impairment testing, goodwill from acquisition date is allocated to each of the Group’s cash-generating unit (“CGU”) or groups of CGUs that are expected to benefit from the synergies of the combination in which the goodwill arose. The test for impairment of goodwill on consolidation is in accordance with the Group’s accounting policy for impairment of non-financial assets.

Where goodwill forms part of a CGU or groups of CGUs and part of the operation within that unit is disposed of, the goodwill associated with the operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. Goodwill disposed of in this circumstance is measured based on the relative values of the operation and the portion of the CGU retained.

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2.6 Investments in Subsidiaries

In the Company’s separate financial statements, investments in subsidiaries are stated at cost less any accumulated impairment losses. The investments are reviewed for impairment in accordance with the Group’s accounting policy for impairment of non-financial assets.

2.7 Investments in Associates

An associate is an entity, including an unincorporated entity, in which the Group has significant influence but not control or joint control over the financial and operating policies of such an entity.

Investment in associate is accounted for in the consolidated financial statements using the equity method of accounting (except when the investment is classified as held for sale, in which case it is accounted for in accordance with FRS 5, Non-current Assets Held for Sale and Discontinued Operations) and are initially recognised at cost. Under the equity method of accounting, the Group’s share of its associate post-acquisition profits or losses is recognised in the income statement and its share of post-acquisition movements in other comprehensive income is recognised in other comprehensive income. The cumulative post-acquisition changes in net assets of the associate are adjusted against the carrying amount of the investment. Equity accounting is discontinued when the Group’s share of losses of an associate equals or exceeds its interest in the associate unless the Group has incurred legal or constructive obligations or made payments on behalf of the associate.

Unrealised gains on transactions between the Group and the associate are eliminated to the extent of the Group’s interest in the associate. Unrealised losses are eliminated on consolidation and the relevant assets are assessed for impairment.

Goodwill relating to an associate is included in the carrying amount of the investment and is not amortised. Any excess of the Group’s share of the net fair value of the associate’s identifiable assets, liabilities and contingent liabilities over the cost of the investment is excluded from the carrying amount of the investment and is instead included as income in the determination of the Group’s share of the associate’s profit or loss in the period in which the investment is acquired.

After the application of the equity method, the Group determines whether it is necessary to recognise any additional impairment loss with respect to the Group’s net investment in the associate.

In applying the equity method of accounting, the latest audited financial statements of the associate are used. Where the reporting dates of the Group and the associate are not coterminous, equity accounting is applied on the management accounts made to the financial year end of the Group. Uniform accounting policies are adopted for like transactions and events in similar circumstances.

In the Company’s separate financial statements, investment in associate is accounted for at cost less any accumulated impairment losses.


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2.8 Foreign Currencies

(a) Functional and presentation currency

Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency. The consolidated financial statements are presented in Ringgit Malaysia (“RM”), which is also the Company’s functional currency.

(b) Foreign currency transactions and balances

In preparing the financial statements of the individual entities, transactions in currencies other than the entity’s functional currency (foreign currencies) are recorded in the functional currencies using the exchange rates prevailing at the dates of the transactions. At the end of each reporting period, foreign currency monetary assets and liabilities are translated into the functional currency at exchange rates prevailing at the end of the reporting period. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the date of the transactions. Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined.

Exchange differences arising from the settlement of foreign currency transactions and from the translation of foreign currency monetary assets and liabilities are recognised in profit or loss.

Exchange differences arising on the translation of foreign currency non-monetary items carried at fair value are included in profit or loss for the period except for the differences arising on the translation of non-monetary items in respect of which gains or losses are recognised directly in other comprehensive income. Exchange differences arising from such non-monetary items are recognised directly to other comprehensive income.

(c) Foreign operations

The results and financial position of foreign operations that have a functional currency different from the presentation currency of the consolidated financial statements are translated into the presentation currency as follows :-

(i) Assets and liabilities for each financial position date presented are translated at the closing rate prevailing at the end of the reporting period;

(ii) Items of income and expenses are translated at average exchange rates for the financial year, which approximates the exchange rates at the dates of the transactions; and

(iii) All resulting exchange differences are recognised in other comprehensive income and are accumulated in exchange translation reserve within equity.

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2.8 Foreign Currencies (Cont’d)

(c) Foreign operations (Cont’d)

Exchange differences arising from monetary items that form part of the Company’s net investment in a foreign operation and that are denominated in the functional currency of the Company or the foreign operation are recognised in the profit or loss of the Company or of the foreign operation, as appropriate. In the Group financial statements, such exchange differences are recognised initially in other comprehensive income and accumulated in equity under exchange translation reserve. On disposal of a foreign operation, the cumulative amount recognised in other comprehensive income and taken to equity under exchange translation reserve will be reclassified to profit or loss.

Goodwill and fair value adjustments arising on the acquisition of foreign operations are treated as assets and liabilities of the foreign operations and are recorded in the functional currency of the foreign operations and translated at the closing rate at the end of the reporting period.

2.9 Property, Plant and Equipment and Depreciation

Items of property, plant and equipment are stated at cost less accumulated depreciation and impairment losses except for certain properties which are carried at their 1985 valuation less accumulated depreciation. Cost includes expenditure that is directly attributable to the acquisition of the asset.

The Group does not adopt a policy of revaluation and has applied the transitional provisions issued by the MASB upon adoption of the International Accounting Standard (“IAS”) 16 (Revised) whereby the previous revaluation of certain properties in 1985 less accumulated depreciation may be retained as the carrying amount with continuity in the depreciation policy.

The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.


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2.9 Property, Plant and Equipment and Depreciation (Cont’d)

Freehold land and capital work-in-progress are not depreciated. All other property, plant and equipment are depreciated on the straight-line basis so as to write off the cost of the assets to their residual values over their estimated useful lives. Depreciation on capital work-in-progress commences when the assets are ready for their intended use. The estimated useful lives of the Group’s property, plant and equipment are as follows :-

Mills and buildings 2.0% to 5.0%Leasehold land 99 yearsMini hydro power plant 21 yearsPlant, machinery and equipment 10.0% to 33.3%Motor vehicles 20.0%Furniture and fittings 10.0% to 15.5%

The residual values and useful lives of assets are reviewed at each financial year end with the effect of any changes in estimate accounted for on a prospective basis. Property, plant and equipment are reviewed for impairment in accordance with the Group’s accounting policy for impairment of non-financial assets.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. The difference between the net disposal proceeds, if any, and the net carrying amount is recognised in profit or loss.

2.10 Investment Properties

Investment properties are land and/or buildings which are held for rental yields or for capital appreciation or for both or land held for a currently undetermined future use. The investment properties are stated at cost less accumulated depreciation and impairment losses. The depreciation policy adopted for investment properties is similar to property assets under property, plant and equipment as disclosed under Note 2.9. Investment properties are reviewed for impairment in accordance with the Group’s accounting policy for impairment of non-financial assets.

An investment property is derecognised when either it has been disposed of or when the investment property is permanently withdrawn from use and no future economic benefits are expected from its disposal. The difference between the net disposal proceeds, if any, and the net carrying amount is recognised in profit or loss in the period of the retirement or disposal.

2.11 Biological Assets

New planting expenditure incurred on planting and upkeep of immature oil palms and interests incurred during the pre-cropping period are capitalised at cost as biological assets. Upon maturity, all subsequent maintenance expenditure is charged to profit or loss and the costs of biological assets are amortised to profit or loss on a straight line basis over the expected useful lives of the oil palm trees. Replanting expenditure is similarly capitalised and amortised on the afore-mentioned basis.

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2.12 Property Development Activities

(a) Land held for property development

Land held for property development consist of land on which no significant development work has been undertaken or where development activities are not expected to be completed within the normal operating cycle. Such land are classified as non-current assets and are stated at cost less accumulated impairment losses. Costs include the cost of land and all related acquisition costs and costs incurred subsequent to the acquisition on development activities. The recognition and measurement of impairment losses is in accordance with the Group’s accounting policy for impairment of non-financial assets.

Land held for property development is transferred to property development costs (under current assets) when development activities have commenced and are expected to be completed within the normal operating cycle.

(b) Property development costs

Property development costs comprise cost of land and related acquisition costs and all costs that are directly attributable to development activities or that can be allocated on a reasonable basis to such activities. Cost includes interest on borrowings used to finance the purchase or construction of specific projects and other direct expenditure and related overheads incurred in the process of development. On completion of development, unsold properties are transferred to inventories and classified under completed properties held for sale. Property development costs not recognised as an expense are recognised as an asset, which is measured at the lower of cost and net realisable value.

(c) Revenue and expense recognition

When the financial outcome of a development activity can be reliably estimated, property development revenue and expenses are recognised in profit or loss by using the stage of completion method. The stage of completion is determined by reference to the surveys of work performed or to the proportion that property development costs incurred bear to the estimated total costs for the property development, where appropriate.

When the financial outcome of a development activity cannot be reliably estimated, property development revenue is recognised only to the extent of property development costs incurred that is probable will be recoverable, and property development costs on properties sold are recognised as an expense in the period in which they are incurred.

Any expected loss on a property development project including costs to be incurred over the defect liability period is recognised as an expense immediately irrespective of whether the outcome of a property development activity can be estimated reliably.


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2.12 Property Development Activities (Cont’d)

(d) Progress billings

The excess of revenue recognised in profit or loss over billings to purchasers is classified as accrued billings within current assets and the excess of billings to purchasers over revenue recognised in the profit or loss is classified as progress billings within current liabilities.

2.13 Construction Contracts

(a) Revenue and expense recognition

When the outcome of a construction contract can be estimated reliably, contract revenue and contract cost are recognised over the period of the contract as revenue and expenses respectively using the percentage of completion method, determined by reference to surveys of work performed or to the proportion that contract costs incurred for work performed to-date bear to the estimated total costs for the contract, where appropriate.

When the outcome of a construction contract cannot be ascertained reliably, contract revenue is recognised only to the extent of contract costs incurred that are estimated to be recoverable and contract costs are recognised as an expense in the period in which they are incurred.

When it is estimated that the total contract costs will exceed total contract revenue, the expected loss is recognised as an expense immediately.

(b) Gross amount due from/(to) customers for contract work

Amount due from/(to) customers for contract work is the net amount of cost incurred for construction and engineering contracts-in-progress plus profit attributable to contract-in-progress less foreseeable losses, if any, and progress billings. Contract costs incurred to-date include costs directly related to the contract or attributable to contract activities in general and costs specifically chargeable to the customers under the terms of the contract.

2.14 Non-current Assets (or Disposal Groups) Classified as Held for Sale

Non-current assets (or disposal groups) are classified as assets held for sale if their carrying amounts will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the asset (or disposal group) is available for immediate sale in its present condition subject only to terms that are usual and customary.

On initial classification as held for sale, non-current assets or disposal groups (other than investment properties, deferred tax assets, employee benefits assets, financial assets and inventories) are measured at the lower of the carrying amount and fair value less costs to sell. Any differences are included in profit or loss.

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2.15 Impairment of Non-Financial Assets

The carrying amounts of non-financial assets (other than inventories, assets arising from construction contracts, deferred tax assets and non-current assets or disposal groups held for sale) are reviewed for impairment at the end of each reporting period to determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated to determine the amount of impairment loss. For goodwill, intangible assets that have an indefinite useful life and intangible assets that are not yet available for use, the recoverable amount is estimated annually or more frequently when indicators of impairment are identified.

An impairment loss is recognised if the carrying amount of an asset or a cash generating unit (“CGU”) exceeds its recoverable amount. A CGU is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or group of assets. Impairment losses recognised in respect of CGUs (or groups of CGUs) are allocated first to reduce the carrying amount of any goodwill allocated to the units (or groups of units) and then to reduce the carrying amount of the other assets in the units (or groups of units) on a pro rata basis.

The recoverable amount of an asset or CGU is the higher of its fair value less costs to sell and its value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset.

An impairment loss is recognised to profit or loss in the period in which it arises, unless the asset is carried at revalued amount. Any impairment loss of a revalued asset is recognised directly against the revaluation surplus account for that asset to the extent that the impairment loss does not exceed the amount held in the revaluation surplus account.

Impairment loss on goodwill is not reversed in a subsequent period. An impairment loss for an asset other than goodwill is reversed if, and only if, there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised. The carrying amount of an asset other than goodwill is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of amortisation or depreciation) had no impairment loss been recognised for the asset in prior years. A reversal of impairment loss for an asset other than goodwill is recognised to profit or loss unless the asset is carried at revalued amount, in which case, such reversal is treated as a revaluation increase.

2.16 Inventories of Completed Properties Held for Sale

Completed properties held for sale are stated at the lower of cost and net realisable value. Cost includes cost of land and attributable construction cost.


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2.17 Financial Assets

The Group recognises all financial assets in its statement of financial position when, and only when, the Group becomes a party to the contractual provisions of the instruments.

Classification and measurement

Financial assets are initially measured at fair value plus, in the case of financial assets not at fair value through profit or loss, directly attributable transaction costs.

The Group determines the classification of its financial assets depending on the nature and purpose of the financial assets at the time of initial recognition. The categories of financial assets applicable to the Group are loans and receivables and available-for-sale financial assets. The Group does not have any financial assets that are to be categorised as at fair value through profit or loss or held-to-maturity investments.

(a) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Trade and other receivables, deposits, cash and bank balances are classified as loans and receivables.

Subsequent to initial recognition, loans and receivables are measured at amortised cost using the effective interest method. Gains and losses are recognised in profit or loss when loans and receivables are derecognised or impaired, and through the amortisation process.

(b) Available-for-sale financial assets

Available-for-sale financial assets are non-derivative financial assets that are designated as available for sale or are not classified as loans and receivables, held-to-maturity investments or at fair value through profit or loss. Available-for-sale financial assets include quoted and unquoted equity and debt instruments.

Subsequent to initial recognition, quoted equity and debt instruments are measured at fair value. A gain or loss from changes in fair value is recognised in other comprehensive income, except that impairment losses, foreign exchange gains or losses on monetary instruments and interest calculated using the effective interest method are recognised in profit or loss. The cumulative gain or loss previously recognised in other comprehensive income is reclassified from equity to profit or loss as a reclassification adjustment when the financial asset is derecognised. Dividends on an equity instrument are recognised in profit or loss when the Group’s right to receive payment is established.

Investments in unquoted equity and debt instruments where fair value cannot be reliably measured, are measured at cost less impairment loss.

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2.17 Financial Assets (Cont’d)

Regular way purchase or sale of financial assets

Regular way purchases or sales of financial assets are recognised and derecognised using trade date accounting. Trade date accounting refers to :-

• therecognitionofanassettobereceivedandtheliabilitytopayforitonthetradedatewhichis the date the Group commits itself to purchase or sell an asset; and

• derecognitionofanassetthatissold,therecognitionofanygainorlossondisposalandtherecognition of a receivable from the buyer for payment on the trade date.

Impairment of financial assets

The Group assesses at the end of each reporting period whether there is any objective evidence that a financial asset is impaired. Financial assets are considered to be impaired when objective evidence indicates that a loss event has occurred after the initial recognition of the assets and that the loss event had a negative effect on the estimated future cash flows of that asset that can be reliably estimated. Losses expected as a result of future events, no matter how likely, are not recognised. For a quoted equity and debt instrument, a significant or prolonged decline in the fair value of the investment below its cost is considered to be objective evidence of impairment.

When loans and receivables are impaired, the carrying amount of the asset is reduced through an allowance account and the amount of the loss is recognised in profit or loss. Impairment loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the asset’s original effective interest rate.

If, in a subsequent period, the amount of the impairment loss on loans and receivables decreases and the decrease can be related objectively to an event occurring after the impairment was recognised (such as an improvement in the debtor’s credit rating), the reversal of the previously recognised impairment loss is recognised in profit or loss.

When an available-for-sale financial asset is impaired, the cumulative loss in relation to decline in fair value previously recognised in other comprehensive income, is reclassified from equity and recognised in profit or loss as a reclassification adjustment even though the financial asset has not been derecognised. The amount of cumulative loss that is reclassified is the difference between the acquisition cost (less any principal repayment and amortisation) and current fair value, less any impairment loss on that financial asset previously recognised in profit or loss.

Impairment losses recognised in profit or loss for an investment in an equity instrument classified as available-for-sale is not reversed through profit or loss. Increase in fair value, if any, subsequent to the impairment loss, is recognised in other comprehensive income.


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2.17 Financial Assets (Cont’d)

Impairment of financial assets (Cont’d)

If the fair value of a debt instrument classified as available-for-sale, increases in a subsequent period and the increase can be objectively related to an event occurring after the impairment loss was recognised in profit or loss, the impairment loss is reversed with the amount of the reversal is recognised in profit or loss.

An amount of impairment loss in respect of financial assets carried at cost is measured as the difference between the carrying amount of the financial asset and the present value of estimated future cash flows discounted at the current market rate of return for a similar financial asset. Such impairment losses are not reversed in subsequent periods.

Derecognition of a financial asset

A financial asset is derecognised when, and only when, the contractual right to receive cash flows from the financial asset has expired or the Group transfers the financial asset without retaining control or transfers substantially all the risks and rewards of ownership of the financial asset to another party. On derecognition of a financial asset in its entirety, the difference between the carrying amount and the sum of consideration received (including any new asset obtained less any new liability assumed) and any cumulative gain or loss that had been recognised directly in other comprehensive income is recognised in profit or loss.

2.18 Cash and Cash Equivalents

Cash and cash equivalents include cash in hand, bank balances, deposits with licensed banks, bank overdrafts and highly liquid investments which are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. The statements of cash flows are prepared using the indirect method. Cash and cash equivalents (other than bank overdrafts) are categorised and measured as loans and receivables in accordance with Note 2.17(a).

2.19 Equity Instruments

An equity instrument is any contract that evidences a residual interest in the assets of the Group and the Company after deducting all of its liabilities. Ordinary shares are classified as equity instruments. Distributions to holders of ordinary shares are debited directly to equity and dividends declared on or before the end of the reporting period are recognised as liabilities. Costs directly attributable to equity transactions are accounted for as a deduction, net of tax, from equity.

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2.20 Treasury Shares

Shares repurchased by the Company are held as treasury shares and are measured and carried at the cost of purchase. Treasury shares are presented in the financial statements as a set-off against equity.

No gain or loss is recognised in profit or loss on the purchase, sale, issue or cancellation of treasury shares. Should such shares be re-issued by re-sale in the open market, the difference between the sales consideration and the carrying amount of the treasury shares is shown as a movement in equity. Where treasury shares are distributed as share dividends, the cost of the treasury shares is applied in the reduction of the share premium account or distributable retained profits or both.

2.21 Hire Purchase and Finance Lease Arrangements and Operating Leases

A lease is recognised as a finance lease if it transfers substantially to the Group all the risks and rewards incident to ownership of the leased assets. All other leases are classified as operating leases.

Assets acquired under hire purchase arrangements are recognised and measured in a similar manner as finance leases.

(a) Assets acquired under hire purchase and finance lease arrangements

Assets acquired under hire purchase and finance lease arrangements are stated at the amounts equal at the inception of the arrangement to the lower of the fair values and the present values of the minimum hire purchase or lease payments.

The corresponding obligations are taken up as hire purchase or finance lease liabilities. Hire purchase or lease payments are apportioned between the outstanding liabilities and finance charges which are charged to profit or loss over the period of the hire purchase/lease term so as to produce a constant periodic rate of interest on the remaining balance of the liabilities for each period.

The depreciation policy of property, plant and equipment acquired under hire purchase and finance lease arrangements are consistent with the Group’s depreciation policy as set out in Note 2.9 above.

(b) Operating lease

Operating lease payments are recognised as an expense in the profit or loss on a straight line basis over the period of the relevant leases.


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2.22 Financial Liabilities

The Group recognises all financial liabilities in its financial statements when, and only when, the Group becomes a party to the contractual provisions of the instruments.

Classification and measurement

Financial liabilities are initially measured at fair value plus, in the case of financial liabilities not at fair value through profit or loss, directly attributable transaction costs.

Financial liabilities are classified as either financial liabilities at fair value through profit or loss or other financial liabilities. The Group does not have any financial liabilities at fair value through profit or loss.

Other financial liabilities are subsequently measured at amortised cost using the effective interest method. Other financial liabilities of the Group include trade and other payables, loans and borrowings.

A gain or loss on other financial liabilities is recognised in profit or loss when the liabilities are derecognised and through the amortisation process.

Derecognition of a financial liability

A financial liability is derecognised when, and only when, it is extinguished, i.e. when the obligation specified in the contract is discharged or cancelled or expires. An exchange between an existing borrower and lender of debt instruments with substantially different terms are accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. Similarly, a substantial modification of the terms of an existing financial liability is accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. The difference between the carrying amount of a financial liability extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss.

2.23 Financial Guarantee Contracts

A financial guarantee contract is a contract that requires the issuer to make specified payments to reimburse the holder for a loss it incurs because specified debtor fails to make payment when due in accordance with the original or modified terms of a debt instrument.

Financial guarantee contracts are recognised initially as a liability at fair value, net of transaction costs. Subsequent to initial recognition, financial guarantee contracts are amortised in profit or loss using the straight-line method over the contractual period or, when there is no specified contractual period, recognised in profit or loss upon discharge of the guarantee. When settlement of a financial guarantee contract becomes probable, an estimate of the obligation is made in accordance with FRS 137, Provisions, Contingent Liabilities and Contingent Assets. If the carrying amount of the financial guarantee is lower than the obligation estimated, the carrying value is adjusted to the obligation amount and accounted for as a provision.

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2.24 Provisions

Provisions are recognised when the Group has a present legal and constructive obligation as a result of past events and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Where the effect of time value of money is material, the amount of provision is measured at the present value of the expenditure expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. Where discounting is used, the increase in the amount of a provision due to passage of time is recognised as finance cost.

2.25 Borrowing Costs

Borrowing costs that are directly attributable to the acquisition, construction, production and preparation of assets until they are ready for their intended use or sale are capitalised as part of the cost of those assets. Other borrowing costs are recognised as an expense in the period in which they are incurred.

2.26 Employee Benefits

(a) Short-term employee benefits

Wages, salaries and social security contributions, paid annual and sick leave, bonuses and non-monetary benefits are recognised as an expense or included in the costs of assets, where applicable, in the period in which the associated services are rendered by employees of the Group.

(b) Post-employment benefits

Defined contribution plans

The Group provides post-employment benefits by way of contribution to defined contribution plans operated by the relevant authorities at the prescribed rates.

Defined contribution plans are post-employment benefits plans under which the Group pays fixed contributions into a separate entity (a fund) and will have no legal or constructive obligation to pay further contributions if the fund does not hold sufficient assets to pay all employee benefits relating to employee service in the current and prior periods.

The Group’s contributions to defined contribution plans are recognised as an expense in the income statement in the period to which the contributions relate or included in the costs of assets, where applicable.


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2.26 Employee Benefits (Cont’d)

(b) Post-employment benefits (Cont’d)

Termination benefits

Termination benefits are recognised as a liability and an expense when the Group is committed to terminate the employment of current employees according to a detailed formal plan without possibility of withdrawal. Termination benefits falling over more than twelve (12) months after the end of the reporting period are discounted to present value.

2.27 Income Taxes

Tax expense is the aggregate amount of current and deferred taxation. Current and deferred taxes are recognised as income or expense in profit or loss except to the extent that the taxes relate to items recognised outside profit or loss, either in other comprehensive income or directly in equity or a business combination.

Current tax is the expected tax payable on taxable income for the year, computed using tax rates enacted or substantively enacted by the end of the reporting period.

Deferred tax is provided using the liability method on temporary differences at the end of the reporting period between the carrying amounts of assets and liabilities and the amounts attributed to those assets and liabilities for taxation purposes.

Deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised for all deductible temporary differences and unabsorbed tax losses and unused tax credits to the extent that it is probable that future taxable profit will be available against which the assets can be utilised.

The carrying amount of deferred tax assets is reviewed at the end of each reporting period and is reduced to the extent that it is no longer probable that the related tax benefits will be realised.

Tax rates enacted or substantively enacted by the end of the reporting period are used to determine deferred tax.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its current tax assets and liabilities on a net basis.

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2.28 Revenue Recognition

Revenue is measured at the fair value of the consideration received or receivable for the sale of goods or rendering of services in the ordinary course of the Group’s activities. Revenue is recognised when it can be measured reliably and to the extent that it is probable that the economic benefits associated to the transactions will flow to the Group. The following specific recognition criteria must also be met before revenue is recognised :-

(a) Sales of goods

Revenue from sale of goods is recognised upon the transfer of significant risks and rewards of ownership to the buyer of the goods, net of discounts and returns. Revenue is not recognised to the extent where there are significant uncertainties regarding recovery of the consideration due, associated costs or the possible return of goods.

(b) Revenue from services

Revenue from services is recognised upon rendering of the services.

(c) Revenue from sale of properties

Revenue from sale of properties on property development activities is recognised based on the policy as disclosed in Note 2.12(c).

(d) Revenue from construction contracts

Revenue from construction contracts is recognised based on the policy as disclosed in Note 2.13(a).

(e) Dividend income

Dividend income is recognised when the right to receive payment has been established.

(f) Interest income

Interest income is recognised on an accrual basis using the effective interest method.

(g) Rental income

Revenue from letting of properties is recognised on an accrual basis over the period of tenancy.

All intra-group revenue are eliminated on consolidation.


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3. Significant Accounting Judgements and Key Sources of Estimation Uncertainty

The preparation of financial statements in conformity with the Financial Reporting Standards requires the directors to exercise their judgements in the process of applying the Group’s accounting policies and which may have significant effects on the amounts recognised in the financial statements. It also requires the use of accounting estimates and assumptions that affect the reported amounts of assets, liabilities and disclosure of contingent assets and liabilities as at the date of the financial statements and the results reported for the reporting period and that may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year. Although these estimates and assumptions are based on the directors’ best knowledge of events and actions, actual results may differ.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

3.1 Significant judgements in applying the Group’s accounting policies

In the process of applying the Group’s accounting policies, which are described in Note 2, the directors are of the opinion that any instances of application of judgement are not expected to have significant effect on the amounts recognised in the financial statements, apart from those involving estimations which are dealt with below.

3.2 Key sources of estimation uncertainty

The key assumptions concerning the future and other key sources of estimation uncertainty at the end of the reporting period, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are discussed below.

(a) Property development/Construction contracts

The Group recognises revenue from property development and construction activities and the related expenses in the income statement by using the percentage of completion method. The percentage of completion is determined by the proportion that property development/contract costs incurred for work performed to-date compared to the estimated total property development/contract costs.

Significant judgement is required in determining the percentage of completion, the extent of the property development/contract costs incurred, the estimated total property development/contract revenue and costs as well as the recoverability of the property development/construction contracts. Total property development/contract revenue also includes an estimation of variation works that are recoverable from customers. In making the judgement, the Group evaluates by relying on past experience and the work of specialists.

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3. Significant Accounting Judgements and Key Sources of Estimation Uncertainty (Cont’d)

3.2 Key sources of estimation uncertainty (Cont’d)

(b) Impairment of assets

The Group assesses impairment of property, plant and equipment, land held for development and property development costs when the events or changes in circumstances indicate that the carrying amounts of the assets may not be recoverable. In assessing such impairment, the recoverable amount of the assets is estimated using the latest available fair value after taking into account the costs to sell or expected value in use of the relevant assets.

(c) Deferred tax assets

Deferred tax assets are recognised for unabsorbed tax losses, unutilised capital allowances and other deductible temporary differences to the extent that it is probable that taxable profit will be available against which the tax losses, capital allowances and other deductible temporary differences can be utilised. Management judgement is required to determine the amount of deferred tax assets that can be recognised, based on the assessment on the probability of the availability of future taxable profits. The total carrying amount of deferred tax assets recognised on unabsorbed tax losses, unutilised capital allowances and other deductible temporary differences of the Group as at the end of the reporting period is RM18,111,821 (2010 : RM10,535,833).

The unrecognised unabsorbed tax losses, unutilised capital allowances and other deductible temporary differences are disclosed under Note 13.2.


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4. Property, Plant and Equipment

4.1 The movements of property, plant and equipment during the financial year are as follows :-

2011 - Group

Plant, equipment and Furniture Freehold Leasehold Mini hydro motor and land land Buildings power plant vehicles fittings Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

CostBalance at 1 April 2010 :- As previously reported 1,109 – 6,161 27,185 6,785 5,593 46,833- Effects of adopting Amendment to FRS 117 – 184 – – – – 184

- As restated 1,109 184 6,161 27,185 6,785 5,593 47,017Additions – – – 183 1,359 301 1,843Disposals (565) – (324) – (1,598) (69) (2,556)Write offs – – – – (90) (2,642) (2,732)Effects of changes in exchange rates – – – – (24) (20) (44)Reclassification – – – – (799) 799 –

Balance at 31 March 2011 544 184 5,837 27,368 5,633 3,962 43,528

Annual Report 2011

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4. Property, Plant and Equipment (Cont’d)

4.1 (Cont’d)

2011 - Group (Cont’d)

Plant, equipment and Furniture Freehold Leasehold Mini hydro motor and land land Buildings power plant vehicles fittings Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Accumulated depreciation/ Accumulated impairment lossesBalance at 1 April 2010 :- As previously reported – – 1,746 324 3,940 4,192 10,202- Effects of adopting Amendment to FRS 117 – 62 – – – – 62

- As restated – 62 1,746 324 3,940 4,192 10,264Charge for the year – 3 131 1,313 388 479 2,314Additional impairment during the year 94 – – – – – 94Disposals – – (158) – (1,012) (31) (1,201)Write offs – – – – (90) (2,594) (2,684)Effects of changes in exchange rates – – – – (7) (18) (25)Reclassification – – – – (731) 731 –

Balance at 31 March 2011 94 65 1,719 1,637 2,488 2,759 8,762

Balance at 31 March 2011 comprised :- Accumulated depreciation – 65 1,719 1,637 2,488 2,759 8,668- Accumulated impairment losses 94 – – – – – 94

94 65 1,719 1,637 2,488 2,759 8,762

Net book value as at 31 March 2011 450 119 4,118 25,731 3,145 1,203 34,766


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4.1 (Cont’d)

2010 - Group

Plant, equipment and Furniture Capital Freehold Leasehold Mini hydro motor and work-in- land land Buildings power plant vehicles fittings progress Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Cost/ValuationBalance at 1 April 2009 :- As previously reported 1,109 – 15,288 – 11,776 7,614 26,583 62,370- Effects of adopting Amendment to FRS 117 – 1,326 – – – – – 1,326

- As restated 1,109 1,326 15,288 – 11,776 7,614 26,583 63,696Additions – – – – 47 636 602 1,285Acquisition of subsidiaries (Note 6.2.2(a)) – – 3,680 – 630 758 – 5,068Disposals – (1,142) (12,807) – (2,834) (571) – (17,354)Write offs – – – – (784) (4,894) – (5,678)Transfers – – – 27,185 – – (27,185) –Reclassification – – – – (2,050) 2,050 – –

Balance at 31 March 2010 1,109 184 6,161 27,185 6,785 5,593 – 47,017

Balance at 31 March 2010 comprised :- At valuation – – – – – – – –- At cost 1,109 184 6,161 27,185 6,785 5,593 – 47,017

1,109 184 6,161 27,185 6,785 5,593 – 47,017

Annual Report 2011

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4.1 (Cont’d)

2010 - Group (Cont’d)

Plant, equipment and Furniture Capital Freehold Leasehold Mini hydro motor and work-in- land land Buildings power plant vehicles fittings progress Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Accumulated depreciation/ Accumulated impairment lossesBalance at 1 April 2009 :- As previously reported – – 10,149 – 8,259 6,229 – 24,637- Effects of adopting Amendment to FRS 117 – 355 – – – – – 355

- As restated – 355 10,149 – 8,259 6,229 – 24,992Charge for the year – 3 303 324 596 397 – 1,623Acquisition of subsidiaries (Note 6.2.2(a)) – – 251 – 246 569 – 1,066Disposals – (296) (8,957) – (2,518) (133) – (11,904)Write offs – – – – (764) (4,749) – (5,513)Reclassification – – – – (1,879) 1,879 – –

Balance at 31 March 2010 – 62 1,746 324 3,940 4,192 – 10,264

Balance at 31 March 2010 comprised :- Accumulated depreciation – 62 1,746 324 3,940 4,192 – 10,264- Accumulated impairment losses – – – – – – – –

– 62 1,746 324 3,940 4,192 – 10,264

Net book value as at 31 March 2010- At valuation – – – – – – – –- At cost 1,109 122 4,415 26,861 2,845 1,401 – 36,753

1,109 122 4,415 26,861 2,845 1,401 – 36,753


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4.1 (Cont’d)

2011 - Company

Plant, equipment Furniture and motor and Buildings vehicles fittings Total RM’000 RM’000 RM’000 RM’000

CostBalance at 1 April 2010 609 1,859 426 2,894Additions – 1,024 10 1,034Disposals – (554) – (554)Write offs – – (78) (78)

Balance at 31 March 2011 609 2,329 358 3,296

Accumulated depreciationBalance at 1 April 2010 561 676 229 1,466Charge for the year 24 188 69 281Disposals – (253) – (253)Write offs – – (76) (76)

Balance at 31 March 2011 585 611 222 1,418

Net book value as at 31 March 2011 24 1,718 136 1,878

Annual Report 2011

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4.1 (Cont’d)

2010 - Company

Plant, equipment Furniture Leasehold and motor and Buildings land vehicles fittings Total RM’000 RM’000 RM’000 RM’000 RM’000

Cost/ValuationBalance at 1 April 2009 :- As previously reported 13,416 – 1,932 1,026 16,374- Effects of adopting Amendment to FRS 117 – 1,142 – – 1,142

- As restated 13,416 1,142 1,932 1,026 17,516Additions – – – 81 81Disposals (12,807) (1,142) (73) – (14,022)Write offs – – – (681) (681)

Balance at 31 March 2010 609 – 1,859 426 2,894

Balance at 31 March 2010 comprised :- At valuation – – – – –- At cost 609 – 1,859 426 2,894

609 – 1,859 426 2,894


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4.1 (Cont’d)

2010 - Company (Cont’d)

Plant, equipment Furniture Leasehold and motor and Buildings land vehicles fittings Total RM’000 RM’000 RM’000 RM’000 RM’000

Accumulated depreciationBalance at 1 April 2009- As previously reported 9,302 – 556 827 10,685- Effects of adopting Amendment to FRS 117 – 296 – – 296

- As restated 9,302 296 556 827 10,981Charge for the year 216 – 193 64 473Disposals (8,957) (296) (73) – (9,326)Write offs – – – (662) (662)

Balance at 31 March 2010 561 – 676 229 1,466

Net book value as at 31 March 2010- At valuation – – – – –- At cost 48 – 1,183 197 1,428

48 – 1,183 197 1,428

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4.2 Property, plant and equipment include the following assets acquired under hire purchase and finance lease :-

Accumulated Net book Depreciation Cost depreciation value charge RM’000 RM’000 RM’000 RM’000

Group

2011Motor vehicles 3,925 1,169 2,756 351

2010 Motor vehicles 3,211 1,024 2,187 431

Company

2011Motor vehicles 2,328 610 1,718 343

2010Motor vehicles 1,235 267 968 125

4.3 The Company’s buildings together with the leasehold land had been disposed of in the previous financial year. Previously, the Company’s buildings and the leasehold land had been revalued based on a valuation performed by a firm of professional valuers using the comparison method in 1985. The surplus arising from this revaluation was credited to capital reserves.

4.4 There are no encumbrances on the Property, Plant and Equipment of the Group and of the Company other than the assets stated under Note 4.2 and the following assets of a subsidiary which have been charged to financial institutions in consideration for term loan facility granted :-

Group Net book value 2011 2010 RM’000 RM’000

Mini hydro power plant 25,731 26,861


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5. Investment Properties

Group 2011 2010 RM’000 RM’000

CostBalance at beginning of year 263,347 –Additions 38,372 300,519Effects of changes in exchange rates (3,651) (37,172)

Balance at end of year 298,068 263,347

Accumulated depreciationBalance at beginning of year 1,454 –Depreciation charge for the year 3,562 1,600Effects of changes in exchange rates (32) (146)


Net carrying amount at 31 March 293,084 261,893

Fair value 371,810 263,347

The investment properties of the Group consist of two (2) parcels of freehold land with buildings thereon which are located in London, United Kingdom.

One of the investment properties with carrying amount of RM255,120,371 (2010 : RM261,893,254) has been pledged to a financial institution for a term loan facility granted to the Group as disclosed in Note 24.1.

The fair values of the investment properties are arrived at based on the directors’ estimates by reference to independent valuations and latest transacted prices.

The directors estimated that the fair value of the investment property held as at 31 March 2010 approximated its acquisition cost of GBP53,292,897 or equivalent to RM263,346,850.

The amounts of rental income and operating expenses recognised in the profit or loss during the financial year in relation to the investment properties, all of which are revenue generating, are as follows :-

Group 2011 2010 RM’000 RM’000

Rental income 26,377 13,139Direct operating expenses 4,047 2,091Depreciation 3,562 1,600

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6. Investments in Subsidiaries

Company 2011 2010 RM’000 RM’000

Unquoted shares, at cost 492,296 288,564Deemed capital contribution to a subsidiary 199,168 –

691,464 288,564Accumulated impairment losses :- At beginning of year (145,937) (89,140)- Addition – (56,797)- Transferred from impairment loss on amount due from subsidiaries upon : - capitalisation of debts as cost of investment in a subsidiary (Note 6.2.4(a)) (99,229) – - classification of debts as deemed capital contribution to a subsidiary (55,056) –- Written-off 5,450 –

(294,772) (145,937)

396,692 142,627

Loan to a subsidiary is unsecured, interest free and no repayment term is stipulated. The loan is deemed by the Company as a capital contribution to the subsidiary.

6.1 Group’s and Company’s Equity Interest in Subsidiaries

The Group’s equity interest in the subsidiaries and their respective principal activities are as set out in Note 45.

6.2 Acquisitions of Subsidiaries / Additional Interests and Subscription of Shares in Subsidiaries

6.2.1 Acquisitions of subsidiaries in the current financial year

On 10 December 2010, the Company has acquired the following two (2) wholly-owned subsidiaries for a cash consideration of GBP1.00 or equivalent to RM5 for each company :-

(a) Riverich Limited; and(b) Country Realty Limited.

The above acquisitions have no material financial effect to the Group as at the acquisition and reporting date.


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6. Investments in Subsidiaries (Cont’d)

6.2 Acquisitions of Subsidiaries / Additional Interests and Subscription of Shares in Subsidiaries (Cont’d)

6.2.2 Acquisitions of subsidiaries in the previous financial year

(a) On 25 August 2008 and as part of the Business Reorganisation exercise as disclosed in Note 21, the Company had entered into a Conditional Sale and Purchase Agreement with Amcorp Group Berhad (“Amcorp”) and its wholly-owned subsidiary, namely Melawangi Sdn. Bhd. (“Melawangi”) to acquire the entire equity interest in Regal Genius Sdn. Bhd. and Distrepark Sdn. Bhd. and 60% equity interest in HDC-Amcorp JV Sdn. Bhd. (now known as HDCam Sdn. Bhd.) from Amcorp and the entire equity interest in Amcorp Prima Realty Sdn. Bhd. from Melawangi (herein referred to as “the Acquiree Companies”) for a total consideration of RM21,902,871 satisfied via the issuance of 41,988,120 new ordinary shares of RM0.50 each in the Company at par and a cash payment of RM908,811.

As part of the acquisition, the Company settled on behalf of the Acquiree Companies, the inter-company advances owed by the Acquiree Companies to Amcorp (“Interco Debts”) for RM158,814,309 via cash of RM51,191,193 and issuance of 215,246,232 new ordinary shares of RM0.50 each in the Company at par, being the agreed sum between the parties as final settlement of the Interco Debts.

The acquistion was completed on 5 August 2009 with the issuance of 257,234,352 new ordinary shares of RM0.50 each amounting to RM128,617,176 and a cash settlement of RM52,100,004 (before netting off with proceeds from disposal of RM22,100,000). The acquisition gave rise to a negative goodwill of RM1,752,732 and which had been recognised in the Group’s profit or loss in the previous financial year.

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6.2.2 Acquisitions of subsidiaries in the previous financial year (Cont’d)

(a) (Cont’d)

The acquisitions had the following effects on the financial results of the Group in the previous financial year :-

From the date of acquisition to 31-3-2010 RM’000

Revenue 34,986Cost of sales (30,536)

Gross profit 4,450Other operating income 791Distribution expenses (968)Administrative expenses (2,880)Other operating expenses (1,464)Finance costs (438)

Loss before taxation (509)Taxation (876)

Loss for the year (1,385)

If the acquisitions had occurred at the beginning of the previous financial year, the Group’s revenue for the financial year ended 31 March 2010 would have increased by RM10,874,369 to RM251,575,856. It was not practicable to disclose the impact on the Group’s results for the financial year ended 31 March 2010 if the acquisitions had been effected at the beginning of that financial year as the cost of land held for development in the acquiree’s book were held for many years and was not reflective of current market values.


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(a) (Cont’d)

The acquisitions had the following effects on the financial position of the Group as at the end of the previous financial year :-

31-03-2010 RM’000

Property, plant and equipment 3,915Land held for property development 34,888Inventories 9,297Property development costs 155,800Trade and other receivables 25,828Amount due from contract customers 867Cash and bank balances 6,419Long term payables (3,648)Trade and other payables (21,612)Progress billings in respect of property development (832)Hire purchase creditors (210)

Net assets consolidated 210,712

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(a) (Cont’d)

The assets and liabilities arising from the acquisitions were as follows :-

Fair value Acquiree recognised Companies’ on carrying acquisition amount RM’000 RM’000

Property, plant and equipment (Note 4.1) 4,002 4,002Land held for property development (Note 11) 35,065 35,065Deferred tax assets (Note 13) 267 267Property development costs (Note 14) 179,093 162,868Inventories 3,503 2,670Trade and other receivables 5,974 5,973Accrued billings in respect of property development 3,566 3,566Amount due from contract customers 703 703Cash and bank balances 2,193 2,193Trade and other payables (38,251) (37,398)Hire purchase creditors (256) (256)

195,859 179,653Minority interest (13,389)Excess of fair value of identifiable assets and liabilities recognised to the Group’s profit or loss (1,753)

Total purchase consideration 180,717Total purchase consideration discharged by shares issued (128,617)

Purchase consideration discharged by cash 52,100Cash and cash equivalents of subsidiaries acquired (2,193)

Net cash outflow from acquisitions 49,907

(b) On 23 September 2009, Walleng Enterprises Sdn. Bhd., a wholly-owned subsidiary of the Company subscribed for 60 new ordinary shares of GBP1.00 each in Westlink Global Investments Limited (“WGIL”), representing 60% of the issued and paid-up capital of WGIL, at par and for cash consideration. WGIL was incorporated on 6 July 2009 in British Virgin Islands (“BVI”) under BVI Business Companies Act, 2004 and its principal activity was that of property investment.


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6.2.3 Acquisition of additional interest in the previous financial year

On 8 October 2009, the Company entered into a Sale and Purchase Agreement to acquire an additional 3,600,000 ordinary shares of RM1.00 each representing a 40% equity interest in Mawar Delima (M) Sdn. Bhd. (“MDSB”) from a minority shareholder, Drard Holdings Sdn. Bhd. for a total cash consideration of RM1,440,000. The acquisition was completed on even date and had resulted in an increase in the Group’s interest in MDSB from 60% to 100% and correspondingly a decrease in minority interest of RM1,218,300.

The additional interest acquired in MDSB was at fair value and had no financial impact to the consolidated financial results for the previous financial year.

6.2.4 Subscription to additional shares issued by subsidiaires during the financial year

During the financial year, the Company subscribed to the following additional shares issued by the following wholly-owned subsidiaries :-

(a) 25,000 new ordinary shares of RM1.00 each issued by Amcorp Management Services Sdn. Bhd. (formerly known as AMDB Management Services Sdn. Bhd.) at an issue price of approximately RM7,038 per ordinary shares and 25,000 new redeemable convertible preference shares of RM1.00 each at par by way of capitalisation of inter-company advances of RM175,981,618;

(b) 300 new ordinary shares of RM1.00 each issued by Walleng Enterprises Sdn. Bhd. at an issue price of RM96,034 per ordinary shares for cash consideration; and

(c) 4,999,998 new ordinary shares of RM1.00 each issued by Amcorp Power Sdn. Bhd. (formerly known as AMDB Power Sdn. Bhd.) at par settled by way of capitalisation of inter-company advances of RM1,021,384 and the remaining consideration by way of cash.

The subscription of new shares has no financial impact to the consolidated financial results for the current financial year.

Annual Report 2011

93




6.2.5 Subscription to additional shares issued by subsidiaires in the previous financial year

(a) On 12 October 2009, the Company subscribed to the following additional shares issued by its wholly-owned subsidiary, Walleng Enterprises Sdn. Bhd. :-

(i) 1,000 new ordinary shares of RM1.00 each at an issue price of RM67,172 per ordinary shares for cash consideration; and

(ii) 1,000 new redeemable convertible preference shares of RM1.00 each at par and for cash consideration.

The subscription of new shares had no financial impact on the financial statements of the Group for the previous financial year.

(b) The Company subscribed and redeemed the following preference shares held in a subsidiary, AMBC Transmission Sdn. Bhd. (“AMBCT”) :-

(i) On 1 September 2009, the Company subscribed to 20,000,000 new redeemable convertible preference shares (“RCPS”) of RM1.00 each at par and for cash consideration through a rights issue of RCPS on the basis of 100 new RCPS for every 11 ordinary shares held.

(ii) On 26 March 2010, the Company subscribed to 3,940,000 new redeemable convertible preference shares A (“RCPS A”) of RM1.00 each at par and for cash consideration. On the same date, the entire existing 39,400,000 RCPS held by the Company were redeemed at a total redemption sum of RM3,940,000. The redemption had resulted in a loss of RM35,460,000 to the Company.

The subscription and redemption of RCPS had no financial impact on the Group’s financial statements for the previous financial year.


94



6.3 Disposal of Subsidiaries 6.3.1 Subsidiaries struck off/wound up during the financial year

(a) During the financial year, the following direct and indirect subsidiaries of the Company have been struck off from the register of Companies Commission of Malaysia and the Companies Registry of Hong Kong respectively upon the application by the Company :-

(i) Beringin Indah Sdn. Bhd.(ii) Kaktus Permai Sdn. Bhd.(iii) Kaktus Ceria Sdn. Bhd.(iv) Taifab Hongkong Limited(v) Jelas Warna Sdn. Bhd.(vi) AMCE Builders Sdn. Bhd.(vii) Taifab Trading (M) Sdn. Bhd.(viii) Gerak Rasmi Sdn. Bhd.

(b) During the financial year, Ideal Resort Sdn. Bhd. (“IRSB”), a direct subsidiary of the Company has held its Final Meeting to conclude the members’ voluntary winding-up. The Liquidator has lodged a Return relating to Final Meeting with the Companies Commission of Malaysia and the Official Receiver on 28 September 2010. IRSB has since been dissolved on 28 December 2010.

The above striking-offs and winding up have no material financial effect to the Group.

6.3.2 Disposal / Discontinued operations during the previous financial year

On 25 August 2008 and as part of the Business Reorganisation exercise as disclosed in Note 21, the Company had entered into a Conditional Sale and Purchase Agreement with Amcorp Group Berhad (“Amcorp”) to dispose its entire equity interest in Restoran Seri Melayu Sdn. Bhd., RSM Catering And Management Services Sdn. Bhd., Harpers Travel (Malaysia) Sdn. Berhad and Harpers Tours (Malaysia) Sdn. Berhad for a total cash consideration of RM15,400,000.

The disposal was completed on 5 August 2009 and had resulted in a gain of RM3,462,003 and RM10,666,900 to the Group and to the Company respectively. The gain to the Group had been presented under profit from discontinued operations in the Group’s profit or loss as disclosed in Note 20. The assets and liabilities disposed and the cash flow effect of the disposal are disclosed in Notes 20(b) and 20(c) respectively.

Annual Report 2011

95


7. Investments in Associates

Group Company 2011 2010 2011 2010 RM’000 RM’000 RM’000 RM’000

Unquoted shares, at cost 154,555 183,747 132,007 161,199Allowance for impairment losses (Note 7.2) (10,628) (27,820) (5,879) (23,071)Group’s share of post-acquisition results net of dividend received (16,960) (8,102) – –

126,967 147,825 126,128 138,128

7.1 The Group’s effective interest in the associates and their respective principal activities are as set out in Note 46.

7.2 The movements of allowance for impairment losses are as follows :-


At beginning of year 27,820 27,820 23,071 23,071 Disposal (17,192) – (17,192) –

At end of year 10,628 27,820 5,879 23,071

7.3 The summarised financial information of the associates are as follows :-

2011 2010 RM’000 RM’000

Assets and liabilities Total assets 1,588,666 1,709,894 Total liabilities (1,022,836) (1,117,362)

Net assets 565,830 592,532

Results Revenue 602,032 242,437 Profit for the year 74,098 15,255


96


7. Investments in Associates (Cont’d)

7.4 During the financial year, the Company disposed 2,000,000 ordinary shares of RM1.00 each in Selaman Sdn. Bhd. (“SSB”), representing 40% of equity interest in SSB for a total cash consideration of RM20,000,000. The disposal has resulted in a net loss of RM10,324,000 to the Group and a net gain of RM6,650,000 to the Company.

7.5 In the previous financial year :-

(a) The Company disposed of its investment in Labuan Power Sdn. Bhd. for a total consideration of RM20 resulting in a no gain, no loss position to the Group and to the Company.

(b) A wholly-owned subsidiary of the Company, AMDB Technics Sdn. Bhd. disposed of its entire equity interest in AM SGB Sdn. Bhd. for a total consideration of RM31,250,000. The disposal resulted in a gain of RM9,714,209 to the Group.

(c) The Company disposed its investments in PTM Sdn. Berhad (“PTM”) and Central Spectrum (M) Sdn. Bhd. (“CSSB”). The disposal had resulted in a net gain of RM4,227,144 to the Group and RM5,865,703 to the Company in relation to the disposal of PTM. The disposal of CSSB had resulted in a no gain, no loss position to the Group and a net gain of RM14,773,325 to the Company.

7.6 The financial year end of the direct and indirect associates are coterminous with the Company except for the following :-

Companies Financial year end

Prisma Tulin Sdn. Bhd. ) 30 June

Augustland Hotel Sdn. Bhd., )Bangi Hotel Sdn. Bhd., )Planergo (Pte) Limited, )Lafarge Concrete (Malaysia) Sdn. Bhd., ) 31 DecemberLafarge Concrete Industries Sdn. Bhd., )Lafarge Concrete (East Malaysia) Sdn. Bhd., and )Supermix-SMJ JV Sdn. Bhd. )

Annual Report 2011

97


8. Other Investments


Available-for-sale financial assetsQuoted in Malaysia :- Shares 1,910 993 933 646- Trust units – 54 – –Unquoted :- Shares 75 75 – –- Bonds 5,160 5,000 – –

7,145 6,122 933 646Less : Impairment loss on unquoted shares (40) (40) – –

7,105 6,082 933 646

Other investmentsGolf club memberships 398 486 – –Less : Allowance for diminution in value (167) (241) – –

231 245 – –

7,336 6,327 933 646

Market values of the quoted investments as at the end of the reporting period are as follows :-


Quoted shares 1,910 1,621 933 804Quoted trust units – 58 – –

1,910 1,679 933 804

The investment in unquoted bonds represents an investment in medium term notes which is secured, bears a fixed rate coupon at 9.00% (2010 : 9.00%) per annum payable semi-annually in arrears and has remaining maturity period of 5 years as at 31 March 2011 (2010 : 6 years).


98


9. Prepaid Lease Payments

Group Company Restated Restated 2011 2010 2011 2010 RM’000 RM’000 RM’000 RM’000

Long leasehold land

Cost/Valuation Balance at beginning of year : - As previously reported 184 1,326 – 1,142 - Effects of the adoption of Amendment to FRS 117 (Note 4.1) (184) (1,326) – (1,142)

- As restated – – – –

Accumulated amortisation Balance at beginning of year : - As previously reported 62 355 – 296 - Effects of the adoption of Amendment to FRS 117 (Note 4.1) (62) (355) – (296)

- As restated – – – –

Net carrying amount – – – –

As disclosed in Note 2.2(d), following the adoption of the Amendment to FRS 117, leasehold land of the Group is regarded as a finance lease and has been reclassified to property, plant and equipment. This Amendment is applied in retrospect.

10. Biological Assets

Group 2011 2010 RM’000 RM’000

Oil palm plantation development expenditure Balance at beginning of year 2,818 1,723 Additions during the year 1,028 1,095


The oil palm plantation development expenditure has not been amortised yet during the financial year as the plantation has not reached maturity.

Annual Report 2011

99


11. Land Held for Property Development

Group 2011 2010 RM'000 RM'000 Cost At beginning of year : - Freehold land / leasehold land 222,695 164,534 - Land related / development expenditure 31,482 2,582

254,177 167,116 Acquisition of subsidiaries (Note 6.2.2(a)) : - Land cost – 58,412 - Land related / development expenditure – 28,744 – 87,156 Additions - Land cost – – - Land related / development expenditure 412 157

412 157 Disposals : - Land cost – (251) - Land related / development expenditure – (1) – (252) At end of year : - Freehold land / leasehold land 222,695 222,695 - Land related / development expenditure 31,894 31,482

254,589 254,177 Accumulated impairment losses At beginning of year (112,184) (60,093) Acquisitions of subsidiaries (Note 6.2.2(a)) – (52,091) Write back of impairment loss 45,677 – At end of year (66,507) (112,184)

Net carrying amount 188,082 141,993


100


12. Long Term Receivables

Group 2011 2010 RM’000 RM’000 Long term receivables comprised :- Retention sums receivable from engineering and construction contracts 38,363 57,528 Less : Retention sums receivable within 12 months (included under current assets - Trade Receivables - Note 16) (23,246) (31,786)

15,117 25,742 The currency exposure profile of long term receivables is as follows :-

Group 2011 2010 RM’000 RM’000

Ringgit Malaysia 3,711 2,480 United Arab Emirates Dirham 11,406 23,262

15,117 25,742

13. Deferred Taxation

Deferred tax (assets)/liabilities

Group Company 2011 2010 2011 2010 RM'000 RM'000 RM'000 RM'000 At beginning of year (5,856) 1,018 – 1,018 Acquisition of subsidiaries – (267) – – Recognised in profit or loss 2,261 (6,581) – (1,018) Effects of changes in exchange rates (5) (26) – – At end of year (3,600) (5,856) – –

Annual Report 2011

101


13. Deferred Taxation (Cont’d) Presented after appropriate offsetting as follows :-

Group Company 2011 2010 2011 2010 RM’000 RM’000 RM’000 RM’000 Deferred tax assets (18,112) (10,536) – – Offset against deferred tax liabilities 12,049 4,201 – –

Net deferred tax assets (6,063) (6,335) – –

Deferred tax liabilities 14,512 4,680 – –

Offset against deferred tax assets (12,049) (4,201) – – Net deferred tax liabilities 2,463 479 – –

13.1 The components and movements of deferred tax liabilities and assets during the financial year prior to offsetting are as follows :-

2011 - Group Effects of Recognised changes in Balance at in profit exchange Balance at

01-04-2010 or loss rates 31-03-2011 RM'000 RM'000 RM'000 RM'000

Deferred tax liabilities Excess of capital allowances over depreciation 51 15 – 66 Land held for development, at fair value 4,186 9,919 – 14,105 Other taxable temporary differences 443 (97) (5) 341

4,680 9,837 (5) 14,512 Deferred tax assets Unabsorbed tax losses (4,201) (7,848) – (12,049)

Investment tax allowance (6,335) 272 – (6,063) (10,536) (7,576) – (18,112) (5,856) 2,261 (5) (3,600)

2011 - Company - Nil


102


13. Deferred Taxation (Cont'd)

13.1 (Cont'd)

2010 - Group

Effects of Acquisition Recognised changes in Balance at of in profit exchange Balance at

01-04-2009 subsidiaries or loss rates 31-03-2010 RM'000 RM'000 RM'000 RM'000 RM'000 Deferred tax liabilitiesExcess of capital allowances over depreciation 15 – 36 – 51 Land held for development, at fair value 4,186 – – – 4,186 Revaluation of property, plant and equipment 1,018 – (1,018) – – Other taxable temporary differences – – 469 (26) 443

5,219 – (513) (26) 4,680

Deferred tax assetsUnabsorbed tax losses (4,201) (267) 267 – (4,201)Investment tax allowance – – (6,335) – (6,335)

(4,201) (267) (6,068) – (10,536)

1,018 (267) (6,581) (26) (5,856)

2010 - Company

Recognised Balance at in profit Balance at 01-04-2009 or loss 31-03-2010 RM'000 RM'000 RM'000 Deferred tax liabilitiesRevaluation of property, plant and equipment 1,018 (1,018) –

Annual Report 2011

103


13. Deferred Taxation (Cont’d)

13.2 The amounts of deferred tax assets which have not been recognised on unabsorbed tax losses, unutilised capital allowances, unutilised reinvestment allowance and other deductible temporary differences are as follows :-


Unabsorbed tax losses 79,977 89,931 344 344 Unutilised capital allowances 20,400 18,901 14,865 14,935 Unutilised reinvestment allowance 4,329 4,329 4,329 4,329 Other deductible temporary differences 15,306 17,367 – 310

120,012 130,528 19,538 19,918 14. Property Development Costs

Group 2011 2010 RM’000 RM’000

Property development costs at beginning of year :- Freehold land / leasehold land 111,945 54,221 - Development costs 81,233 115,816 - Accumulated impairment losses (2,057) – - Accumulated costs recognised in profit or loss (26,494) (136,962)

164,627 33,075 Acquisition of subsidiaries (Note 6.2.2(a)) :- Freehold land / leasehold land – 106,117 - Development costs – 88,411 - Accumulated impairment losses – (4,630)- Accumulated costs recognised in profit or loss – (10,805)

– 179,093

Costs incurred during the year :- Freehold land / leasehold land 842 903 - Development costs 16,949 24,500 17,791 25,403

Costs recognised in profit or loss during the year (12,729) (51,083)


104


14. Property Development Costs (Cont’d)

Group 2011 2010 RM’000 RM’000

Elimination of completed projects : - Freehold land / leasehold land (4,194) (42,179)- Development costs (25,095) (147,185)- Accumulated impairment losses – 2,573 - Accumulated costs recognised in profit or loss 26,422 172,356

(2,867) (14,435)

Disposal :- Freehold land / leasehold land (1,502) (7,117)- Development costs (2,911) (309)- Accumulated costs recognised in profit or loss 3,917 –

(496) (7,426)

Additional impairment loss (365) –

Property development costs at end of year :- Freehold land / leasehold land 107,091 111,945 - Development costs 70,176 81,233 - Accumulated impairment losses (2,422) (2,057)- Accumulated costs recognised in profit or loss (8,884) (26,494) 165,961 164,627

Included in the property development costs are certain parcels of leasehold land of a subsidiary with a total carrying amount of RM20,368,422 (2010 : Nil) which have been pledged to a licensed bank as security in consideration for a term loan facility granted to the subsidiary as disclosed in Note 24.2.

15. Inventories

Group 2011 2010 RM’000 RM’000

Stocks of completed properties 15,228 20,439Raw materials and consumable stores 142 73

15,370 20,512 Write-down in value of inventories (2,330) (2,308)

13,040 18,204 The carrying amount of inventories of the Group as at 31 March 2011 which are carried at net realisable

value is RM5,566,365 (2010 : RM5,758,991).

Annual Report 2011

105


16. Trade Receivables


Trade receivables 15,898 35,092 – 25 Retention sums receivable within 12 months (Note 12) 23,246 31,786 – –

39,144 66,878 – 25

16.1 The trade receivables of the Group and of the Company are stated after deducting allowance for

impairment loss of RM8,671,189 (2010 : RM9,605,897) and RM283,900 (2010 : RM260,900) respectively. The movements of allowance for impairment loss during the financial year are as follows :-


At beginning of year 9,606 8,430 261 274 Addition 222 1,962 25 – Write back (176) (964) (2) (13) Write off (979) (38) – – Acquisition of subsidiaries – 216 – – Effects of changes in exchange rates (1) – – – At end of year 8,672 9,606 284 261

16.2 The Group’s normal trade credit periods range from 14 to 90 days (2010 : 14 to 90 days). The Group’s and the Company’s historical experience in collection of trade receivables falls within the recorded allowances and management believes that no additional credit risk beyond the amounts provided for collection losses is inherent in the Group’s and the Company’s trade receivables.

16.3 As at 31 March 2011, the Group has significant concentration of credit risk in respect of its trade receivables arising from exposure to debts due from one (1) (2010 : two (2)) major customers amounting to RM33,051,539 (2010 : RM55,290,566) representing 61% (2010 : 60%) of the total net trade receivables, including retention sums receivable after twelve (12) months as disclosed in Note 12.


106


16. Trade Receivables (Cont'd)

16.4 The currency exposure profile of trade receivables is as follows :-


Ringgit Malaysia 15,412 15,393 – 25 Pound Sterling 2,077 3,291 – – United Arab Emirates Dirham 21,655 48,194 – –

39,144 66,878 – 25

16.5 The ageing analysis of the trade receivables of the Group and of the Company are set out below :-

2011 - Group

Individual Gross impairment Net

RM'000 RM'000 RM'000 Neither past due nor impaired 29,972 – 29,972 0 to 30 days past due 5 – 5 31 to 60 days past due 4,008 – 4,008 61 to 90 days past due 754 – 754 91 to 120 days past due 1,622 – 1,622 More than 120 days past due 11,455 (8,672) 2,783

47,816 (8,672) 39,144

2011 - Company

Individual Gross impairment Net

RM’000 RM’000 RM’000 Neither past due nor impaired – – – More than 120 days past due 284 (284) –

284 (284) –

Annual Report 2011

107


16. Trade Receivables (Cont’d)

16.5 (Cont’d)

Trade receivables that are individually impaired comprised those debtors who are in significant financial difficulties and have defaulted on their payments. These receivables are not secured by any collateral.

Receivables that are neither past due nor impaired

Trade receivables that are neither past due nor impaired are credit worthy debtors with good payment records with the Group. None of the Group’s trade receivables that are neither past due nor impaired have been renegotiated during the financial year.

Receivables that are past due but not impaired

As at 31 March 2011, the Group has trade receivables amounting to RM9,172,305 that are past due but not impaired. Trade receivables that are past due but not impaired relate to customers that have good track records with the Group. Based on past experience and no adverse information to-date, the directors of the Group are of the opinion that the balances are still considered to be fully recoverable. The Group also closely monitors the financial standing of these trade receivables on a on-going basis to ensure that the Group’s exposure to credit risk is minimised.

17. Other Receivables


Other receivables 17,029 3,161 130 154 Amount due from subsidiaries – – 168,888 338,930

17,029 3,161 169,018 339,084


108


17. Other Receivables (Cont’d)

17.1 The above amounts are stated after deducting the following :-

(a) Allowance for impairment loss on other receivables


At beginning of year 184 3,247 – 3,225 Addition – 162 – – Write back (1) (3,225) – (3,225)Write off (150) – – – At end of year 33 184 – –

(b) Allowance for impairment loss in relation to amount due from subsidiaries

Company 2011 2010 RM’000 RM’000

At beginning of year 324,125 250,483 Addition – 1,000 Write-off (44,458) – Transfer to impairment loss on investments in subsidiaries upon :- capitalisation of debts as cost of investment in a subsidiary (99,229) – - classification of debts as deemed capital contribution to a subsidiary (55,056) – Write back (40,000) (49,802)Assignment of inter-company debts by the immediate holding company of the Group – 122,444

At end of year 85,382 324,125

17.2 The amounts due from subsidiaries are unsecured and are repayable on demand. The amounts due are interest free except for a balance (before allowance for impairment loss) of RM192,618,070 (2010 : RM192,618,070), for which interests are charged at a rate of 3.50% (2010 : 3.50%) per annum.

Annual Report 2011

109


17. Other Receivables (Cont’d)

17.3 The currency exposure profile of other receivables is as follows :-


Ringgit Malaysia 2,189 3,005 169,018 338,692 Pound Sterling 14,485 – – 392 United Arab Emirates Dirham 355 156 – –

17,029 3,161 169,018 339,084

18. Amount Due From/(To) Contract Customers

Group 2011 2010 RM’000 RM’000 Contract costs 364,789 511,874 Profit attributable to work performed to-date 13,442 17,673 Allowance for foreseeable losses (3,527) (775)

374,704 528,772 Less : Progress billings (377,613) (532,053)

(2,909) (3,281) Amount due to customers for contract work 5,090 5,371 Amount due from customers for contract work 2,181 2,090


110


19. Deposits, Cash and Bank Balances


Deposits with licensed banks 8,442 3,854 – – Cash and bank balances 32,289 35,659 845 61

40,731 39,513 845 61

19.1 Cash and bank balances of the Group include balances amounting to RM9,600,405 (2010 : RM13,960,706) which are maintained in designated Housing Development Accounts pursuant to the Housing Developers (Control and Licensing) Act 1966 and Housing Developers Regulations 1991 in connection with property development projects undertaken by certain subsidiaries.

19.2 As at 31 March 2011, deposits with licensed banks of the Group amounting to RM1,796,935 (2010 : RM2,715,565) have been pledged to licensed banks in consideration for banking facilities granted to the Group and hence, not available for general use.

19.3 The currency exposure profile of deposits, cash and bank balances is as follows :-


Ringgit Malaysia 27,768 23,801 845 61 Pound Sterling 8,745 12,515 – – United Arab Emirates Dirham 4,218 3,197 – –

40,731 39,513 845 61

19.4 The effective interest rates of cash designated under the Housing Development Accounts and deposits with licensed banks as at the end of the reporting period are as follows :-

Group Company 2011 2010 2011 2010 % % % %

Cash at banks designated under the 1.75 to 2.00 1.85 to 2.00 – – Housing Development Accounts

Deposits with licensed banks 1.90 to 2.55 1.80 to 2.90 – –

Annual Report 2011

111


20. Non-Current Assets and Disposal Group Classified as Held for Sale

Financial results of disposal group classified under discontinued operations relate entirely to the previous financial year and are shown are as follows :-

Group 2011 2010 RM’000 RM’000

Travel and Leisure division as presented in Note 20(a) – 562 Gain on disposal of discontinued operations as presented in Note 20(c) – 3,462

– 4,024

On 25 August 2008, the Company entered into a Conditional Sale and Purchase Agreement with its immediate holding company, Amcorp Group Berhad (“Amcorp”) for the disposal of the entire issued and paid-up share capital of its subsidiaries, Restoran Seri Melayu Sdn. Bhd., RSM Catering And Management Services Sdn. Bhd., Harpers Travel (Malaysia) Sdn. Berhad and Harpers Tours (Malaysia) Sdn. Berhad (“Travel and Leisure division”) and a 49% owned associate, PTM Sdn. Berhad (“PTM”) for a total cash consideration of RM22,100,000. The disposals were completed during the financial year ended 31 March 2010. (a) The consolidated results of Travel and Leisure division for the previous financial period are presented

below :-

For the period ended 05-08-2009 RM'000

Revenue 7,655 Cost of sales (4,620)

Gross profit 3,035 Other operating income 188 Distribution expenses (1,115) Administrative expenses (947) Other operating expenses (647) Finance costs (13) Profit before tax from discontinued operations 501 Taxation 61

Profit from discontinued operations 562


112


20. Non-Current Assets and Disposal Group Classified as Held for Sale (Cont’d)

(a) (Cont’d)

Profit before taxation has been arrived at after (charging)/crediting the following :-

For the period ended 05-08-2009 RM'000

Net realised gain on foreign exchange 1 Auditors' remuneration (4)

Depreciation of property, plant and equipment (26) Interest expense (13) Rental of premises (163) Rental of equipment (1) Property, plant and equipment written off (22)

(b) The major classes of assets and liabilities of Travel and Leisure division disposed in the previous financial year were as follows :-

As at the date of disposal

RM'000

Assets - at net carrying amount Property, plant and equipment 1,934 Inventories 135 Trade receivables 4,132 Other receivables 13,228 Cash and bank balances 2,198 Total assets disposed 21,627 Liabilities Deferred tax liabilities (14) Trade payables (2,414) Other payables (7,047) Bank overdrafts (84) Hire purchase creditors (130) Total liabilities disposed (9,689) Net assets disposed 11,938

Annual Report 2011

113


20. Non-Current Assets and Disposal Group Classified as Held for Sale (Cont’d)

(c) The consolidated effects on disposal of Travel and Leisure division were as follows :-

As at the date of disposal RM'000

Consideration from disposal 15,400 Less : Net assets disposed (11,938)

Gain on disposal to the Group 3,462

Net cash inflow arising from disposal Proceeds from disposal - cash consideration 15,400 Cash and cash equivalents of subsidiaries disposed, net of bank overdrafts (2,114)

Net cash inflow on disposal 13,286

21. Share Capital

Group and Company 2011 2010 2011 2010 Number Number RM’000 RM’000 Ordinary shares of RM0.50 each Authorised 1,000,000,000 1,000,000,000 500,000 500,000 Issued and fully paid :- At beginning of year 575,461,437 954,681,256 287,731 477,341 Capital reduction (Note 21(a)) – – – (318,227) Shares consolidation (Note 21(b)) – (636,454,171) – – Issued during the year – 257,234,352 – 128,617 At end of year 575,461,437 575,461,437 287,731 287,731


114


21. Share Capital (Cont’d)

In the previous financial year, as approved by the shareholders at the Extraordinary General Meeting held on 12 May 2009 and as part of the Business Reorganisation, the Company had undertaken a Capital Reconstruction exercise which encompassed the following :-

(a) the cancellation of approximately RM0.33 from the par value of the 954,681,256 ordinary shares of RM0.50 each in the Company or RM318,227,085 of the issued and paid-up share capital of the Company (herein referred to as “Capital Reduction”); and

(b) the consolidation of every 3 ordinary shares of approximately RM0.17 each after the completion of the Capital Reduction, into 1 ordinary share of RM0.50 each. Arising therefrom, the 954,681,256 ordinary shares of approximately RM0.17 each were consolidated into 318,227,085 ordinary shares of RM0.50 each.

The Capital Reduction had resulted in the reduction of the Company’s share premium account by RM38,322,870 and the elimination of its accumulated losses by RM356,549,955 as disclosed in Notes 23 and 23.3 respectively.

Under the Business Reorganisation, the Company acquired new subsidiaries and had further issued 257,234,352 new ordinary shares of RM0.50 each for the acquisition of ordinary shares and part settlement of inter-company advances to Amcorp Group Berhad for Amcorp Prima Realty Sdn. Bhd., Regal Genius Sdn. Bhd., Distrepark Sdn. Bhd. and HDC-Amcorp JV Sdn. Bhd. as disclosed in Note 6.2.2.

All the new ordinary shares issued rank pari passu with the existing ordinary shares of the Company.

Annual Report 2011

115


22. Treasury Shares

The shareholders of the Company, by a resolution passed at an annual general meeting held on 3 September 2010, had granted an approval to the Company to buy back its own shares of up to 10% of the issued and paid-up share capital of the Company.

During the financial year, the Company repurchased its issued ordinary shares of RM0.50 each from the open market as summarised below :-

Number Total Purchase price per share of shares consideration Highest Lowest Average RM RM RM RM

Balance at 1 April 2010 – – – – – Shares repurchased during the

financial year :- - May 2010 1,600 689 0.4050 0.4050 0.4050 - June 2010 70,000 26,913 0.3850 0.3800 0.3814 - July 2010 179,500 68,736 0.3861 0.3750 0.3797 - August 2010 220,900 87,882 0.4000 0.3883 0.3949 - September 2010 243,800 96,286 0.3970 0.3850 0.3918 - October 2010 197,500 79,577 0.4000 0.4000 0.4000 - November 2010 82,400 34,115 0.4550 0.4000 0.4107 - December 2010 2,400 1,001 0.4000 0.4000 0.4000 - January 2011 143,900 62,430 0.4433 0.4200 0.4306 - February 2011 481,500 203,276 0.4374 0.3973 0.4191 - March 2011 727,100 296,491 0.4291 0.3880 0.4048

Balance at 31 March 2011 2,350,600 957,396 0.4550 0.3750 0.4042

The total consideration paid, including transaction costs, of RM957,396 was financed by internally generated funds. The shares repurchased were held as treasury shares in accordance with Section 67A of the Companies Act, 1965.

The Company has the right to cancel, resell and/or distribute the treasury shares as dividends at a later date. As treasury shares, the rights attached to voting, dividends and participation in other distribution is suspended. None of the treasury shares repurchased had been sold or cancelled during the financial year.

As at the end of the reporting period, the number of ordinary shares in issue after the share buy-back is 573,110,837 shares of RM0.50 each.


116


23. Reserves


Share premium :- At beginning of year 103,842 142,269 103,842 142,269 - Capital reduction (Note 21) – (38,323) – (38,323)- Share issue expenses – (104) – (104) - At end of year 103,842 103,842 103,842 103,842 Other reserves :- Capital reserves (Note 23.1) 881 881 – – - Fair value reserves 1,008 – 282 – - Exchange translation reserve (Note 23.2) (9,638) (6,829) – –

(7,749) (5,948) 282 – Retained profits (Note 23.3) 187,566 139,583 91,454 15,718

283,659 237,477 195,578 119,560

23.1 Capital reserve


At beginning of year 881 10,416 – 9,535 Revaluation reserve realised to retained profits upon disposal of properties – (9,535) – (9,535) At end of year 881 881 – –

23.2 Exchange translation reserve

Group 2011 2010 RM’000 RM’000

At beginning of year (6,829) 3,134 Currency translation loss (2,809) (9,963) At end of year (9,638) (6,829)

Annual Report 2011

117


23. Reserves (Cont’d)

23.3 Retained profits/(Accumulated losses)


At beginning of year 139,583 (260,162) 15,718 (356,352)Effects of the adoption of FRS 139 (698) – – – Capital reduction (Note 21) – 356,550 – 356,550 Profit for the year 48,681 33,660 75,736 5,985 Realisation of revaluation reserve upon disposal of properties – 9,535 – 9,535

At end of year 187,566 139,583 91,454 15,718

23.4 The Company has an estimated tax credit balance under Section 108 of the Income Tax Act, 1967 of

RM20,280,382 (2010 : RM20,280,382) which, subject to agreement with the tax authorities, is available to frank dividends out of future reserves. In addition, the Company has an estimated tax exempt profit of RM43,260,031 (2010 : RM43,256,081) which, subject to agreement with the tax authorities is available for distribution as tax exempt dividends.

23.5 The Finance Act 2007 introduced a single tier company income tax system with effect from the year of assessment 2008. Under the single tier tax system, tax on a company’s profit is a final tax and dividends distributed to shareholders will be exempted from tax. With the implementation of the new system, companies with credit balance in Section 108 account are allowed either to elect for an irrevocable option to disregard the available tax credit balance as at 31 December 2007 or to continue using such credit balance for the purpose of dividend distribution.

The Company did not elect for an irrevocable option to disregard the available Section 108 as disclosed in Note 23.4 above and is therefore allowed to utilise the tax credit until such time the credit is fully utilised or upon expiry of the six years transitional period on 31 December 2013, whichever is earlier.


118


24. Bank Borrowings


Secured Term loans 160,993 161,003 – – Bai Istisna’ 24,987 23,970 – – Other borrowings – 3,601 – –

185,980 188,574 – – Unsecured Overdrafts 10,077 4,852 7,680 607 Other borrowings 72,782 69,744 72,782 68,330

82,859 74,596 80,462 68,937

Total borrowings 268,839 263,170 80,462 68,937

Less : Amount due within one year Current portion of term loans and Bai Istisna’ (6,311) (5,742) – – Overdrafts (10,077) (4,852) (7,680) (607) Other borrowings (72,782) (73,345) (72,782) (68,330)

(89,170) (83,939) (80,462) (68,937) Non-current portion 179,669 179,231 – –

The term loans and Bai Istisna’ borrowings are repayable as follows :-

Group 2011 2010 RM’000 RM’000 Within 1 year 6,311 5,742 Between 2 to 5 years 161,545 165,314 More than 5 years 18,124 13,917

185,980 184,973

Annual Report 2011

119


24. Bank Borrowings (Cont’d)

24.1 The secured term loan with the carrying amount of RM155,993,246 as at 31 March 2011 (2010 : RM161,003,256) represents a term loan facility granted by a foreign financial institution to a subsidiary, Westlink Global Investments Limited (“WGIL”) to finance the acquisition of an investment property in London (hereinafter referred to as “the Property”).

The term loan is repayable by eighteen (18) quarterly instalments of GBP164,125 each commencing from January 2010 and a bullet payment of GBP29,870,750 in the nineteenth instalment. The term loan matures on 15 July 2014.

The term loan bears interest at 2.30% per annum above the London Interbank Offer Rate (“LIBOR”). WGIL has also simultaneously entered into a floating for fixed interest rate swap as an integral part of the borrowing arrangement to fix the LIBOR at 3.20% per annum. This has an effect of fixing the interest rate at 5.50% per annum.

The term loan is secured by a debenture incorporating first fixed and floating charges over WGIL’s

present and future assets including :-

(a) legal mortgage over the Property;

(b) assignment of the rental income from the Property;

(c) a charge over blocked bank accounts controlled by the financial institution where rental income is transferred;

(d) charge over the shares of WGIL; and

(e) subordination deed entered into between the financial institution, WGIL and its shareholders whereby in the event of default, the term loan takes priority over the amounts due to the shareholders of WGIL.

The major financial covenants include a loan to value ratio not exceeding 70% in the first two (2) years and 65% from year 3 to 5 and an interest cover not lower than 150%.

24.2 The secured term loan with the carrying amount of RM5,000,000 as at 31 March 2011 (2010 : Nil) is granted by a licensed bank to a subsidiary, Amcorp Prima Realty Sdn. Bhd. to part finance a development project undertaken by the subsidiary as disclosed in Note 14. The term loan is secured by way of a fixed charge over certain titles of the leasehold land which are included in property development costs as disclosed in Note 14 and a corporate guarantee provided by the Company.

The term loan is repayable in seven (7) quarterly instalments commencing from 30 April 2012 to 30 September 2013 and bears interest at 2% (2010 : Nil) per annum above the lending bank’s cost of fund.


120


24. Bank Borrowings (Cont’d)

24.3 The outstanding borrowings under the Bai Istisna’ facility represent the amount drawn down from the facility of RM26.0 million granted by a licensed bank to a subsidiary, Amcorp Perting Hydro Sdn. Bhd. (formerly known as AMDB Perting Hydro Sdn. Bhd.) (“AMPH”) to finance the construction of a 4 MW Mini Hydro Power Plant in Sungai Perting, Bentong, Pahang as disclosed in Note 4.4.

The Bai Istisna’ borrowings are repayable in thirty (30) half-yearly instalments at a profit rate of 7.25% per annum commencing from 2011.

The Bai Istisna’ borrowings are secured by a debenture incorporating first fixed and floating charges over all present and future assets of AMPH and a corporate guarantee from the Company.

24.4 The secured portion of other bank borrowings in the previous financial year comprised a short term loan obtained by a subsidiary. The short term loan was secured by way of an assignment of proceeds arising from the subsidiary’s construction contract in United Arab Emirates and a pledge of deposits with a licensed bank as disclosed on Note 19.2 and a corporate guarantee by the Company.

24.5 The currency exposure profile of bank borrowings is as follows :-


Ringgit Malaysia 112,846 98,566 80,462 68,937 Pound Sterling 155,993 161,003 – – United Arab Emirates Dirham – 3,601 – –

268,839 263,170 80,462 68,937

24.6 The effective interest rates of bank borrowings as at the end of the reporting period are as follows :-

Group Company 2011 2010 2011 2010 % % % %

Fixed rate Term loan 5.50 5.50 – – Bai Istisna’ 7.25 7.25 – – Floating rate Term loan 5.80 – – – Overdrafts 7.80 to 9.30 7.30 to 8.80 7.80 to 9.30 7.30 to 8.80 Other borrowings 4.77 to 7.30 4.25 to 8.25 4.77 to 7.30 4.29 to 8.25

Annual Report 2011

121


25. Hire Purchase Creditors

Group Company 2011 2010 2011 2010 RM’000 RM’000 RM’000 RM’000 Future minimum payments :- Payable within 1 year 622 624 374 249 Payable between 2 to 5 years 1,416 925 988 480

2,038 1,549 1,362 729 Future finance charges (206) (119) (150) (50) Present value 1,832 1,430 1,212 679

Payable :-

Within 1 year (shown under Current Liabilities) 542 551 319 222 Between 2 to 5 years (shown under Non- Current Liabilities) 1,290 879 893 457

1,832 1,430 1,212 679

The effective interest rates of hire purchase liabilities as at the end of the reporting period are as follows :-

Group Company % % 2011 4.27 to 7.49 4.27 to 6.17 2010 4.27 to 7.49 4.27 to 6.17


122


26. Long Term Payables

Group 2011 2010 RM’000 RM’000

Shareholder’s loan – 42,327 Retention sums and progress claims payable after 1 year (Note 28) 2,648 6,266 2,648 48,593

The shareholder’s loan as at 31 March 2010 represents advances of GBP8,565,667 from a minority shareholder

of Westlink Global Investments Limited (“WGIL”) provided for the purpose of funding part of the consideration payable for the acquisition of an investment property as disclosed in Note 5. Subject to the terms of the subordination deed (Note 24.1(e)), facility agreement entered into between the financial institution, WGIL and its shareholders, the advances were repayable on the earlier of 30 July 2014 or the date on which the investment property was sold (or such other date as may be agreed from time to time between WGIL and the minority shareholder). No interest was payable on the advances provided.

During the financial year, the loan has been reclassified to other payables within current liabilities upon the request for repayment by the minority shareholder.

27. Retirement Benefits

The retirement benefits plan had been terminated in the previous financial year. Provision for employees’ retirement benefits was determined by an independent actuarial valuation using the Projected Unit Credit Method and was made to cover estimated obligations for payment of retirement benefits to employees. These benefits were payable upon reaching the age of retirement, on retirement due to medical grounds or upon death in respect of employees who had served continuously for a period of five or more years. The last actuarial valuation was performed in May 2008. The movements in the provision for retirement benefits in the previous financial year are as follows :-

Group and Company 2011 2010 RM’000 RM’000

At beginning of year – 630 Recognised in profit or loss for curtailment gain on termination of the retirement benefits scheme – (630) At the end of year – –

The curtailment gain had been recognised under other operating income of the statement of comprehensive income of the previous financial year.

Annual Report 2011

123


28. Trade Payables

Group 2011 2010 RM’000 RM’000 Trade payables 38,483 58,937 Less : Amount payable after 12 months classified as long term payables (Note 26) (2,648) (6,266) 35,835 52,671 Accrued property development costs 7,302 11,788

43,137 64,459

Amount payable after twelve (12) months relates to retention sums and progress claims in relation to construction

contracts.

The Group’s normal trade credit periods range from 30 to 90 days (2010 : 30 to 90 days).

The currency exposure profile of trade payables is as follows :-

Group 2011 2010 RM’000 RM’000 Ringgit Malaysia 28,599 40,979 Pound Sterling 5,706 6,134 United Arab Emirates Dirham 3,050 8,055 United States Dollar 921 3,171 Euro 207 598

38,483 58,937


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29. Other Payables

Group Company 2011 2010 2011 2010 RM’000 RM’000 RM’000 RM’000 Deposit received and other payables 13,907 16,423 834 278 Shareholder’s loan 36,182 – – – Amount owing to subsidiaries – – 137,573 152,418

50,089 16,423 138,407 152,696 The amount owing to subsidiaries is unsecured and repayable on demand. The amount owing is interest

free except for a balance of RM3,736,206 (2010 : RM7,211,344) which attracts interest at rates ranging from 1.65% to 2.25% (2010 : 1.65% to 2.00%) per annum.

Included in other payables of the Group is an amount owing to a minority shareholder amounting to RM3,599,732 (2010 : RM3,599,732). The amount owing is unsecured, interest free and repayable on demand.

The shareholder’s loan represents advances from a minority shareholder and is unsecured, interest free and repayable within 12 months. The amount, net of repayment during the financial year, has been reclassified from long term payables upon the demand for repayment by the minority shareholder during the financial year as disclosed in Note 26.

The currency exposure profile of other payables is as follows :-


Ringgit Malaysia 11,309 13,398 138,407 152,696 Pound Sterling 38,024 2,556 – – United Arab Emirates Dirham 756 469 – –

50,089 16,423 138,407 152,696

Annual Report 2011

125


30. Revenue/Cost of Sales from Continuing Operations

30.1 Revenue is derived from the following sources :-


Development properties 30,058 79,455 – – Property management services 4,807 95 – – Rental of properties 27,817 14,696 – – Value of construction and engineering contracts 45,032 146,185 – – Dividend income :-Unquoted :- Subsidiaries – – 8,524 14,456 - Associates – – 8,514 2,578 Quoted : - Others 99 179 47 182

Others 2,298 92 – – 110,111 240,702 17,085 17,216

30.2 Cost of sales comprised :-


Cost of inventories sold (7,695) – – – Cost of services (582) (3,064) – – Contract costs recognised as an expense (42,087) (138,745) – – Cost of property development units sold (18,138) (62,608) – –

Others (35) – – – (68,537) (204,417) – –


126


31. Operating Profit from Continuing Operations

Group Company 2011 2010 2011 2010 RM’000 RM’000 RM’000 RM’000 Operating profit includes :-

Dividend income (gross) :- Available-for-sale financial assets : - quoted in Malaysia 2 53 – – Interest income 731 1,344 6,744 8,167 Accretion of interest implicit in long term receivables 690 – – – Rental income 122 42 17 17 Gain/(Loss) on disposal of : - property, plant and equipment and leasehold land 1,991 (830) – (1,178) - subsidiaries – – – 10,667 - associates (10,324) 13,941 6,650 20,639 Gain/(Loss) on disposal of investments classified as available-for-sale financial assets : - quoted investments – 65 – (28) - unquoted investments (9) 11 – – Gain on foreign exchange : - realised 42 2 – – - unrealised 45 328 – – Write back of impairment loss on : - investments in subsidiaries – – – 28,500 - land held for property development 45,677 – – – - trade and other receivables 177 4,189 2 3,238 - advances to subsidiaries – – 40,000 49,802 Write back of accrued development costs 8,833 – – – Waiver of debts by subsidiaries – – 31,642 5,711 Bad debts recovered 243 118 216 10,068

Excess of fair value of identifiable assets and liabilities recognised to the Group’s profit or loss – 1,753 – –

Annual Report 2011

127


31. Operating Profit from Continuing Operations (Cont’d)

Group Company 2011 2010 2011 2010 RM’000 RM’000 RM’000 RM’000 and is arrived at after charging :-

Auditors’ remuneration :- - Annual statutory audit : - current 232 262 65 65 - under/(over) provision in prior year 4 11 – (10) - Others 8 50 8 50 Depreciation of : - property, plant and equipment 2,314 1,623 281 473 - investment properties 3,562 1,600 – – Property, plant and equipment written off 48 165 2 19 Impairment loss on : - property, plant and equipment 94 - - - - investments in subsidiaries - - - 85,297 - unquoted investment classified as available- for-sale financial assets – 2 – – - property development costs 365 – – – - trade and other receivables 222 2,124 25 – - advances to subsidiaries – – – 1,000 Rental on land and buildings 702 669 – – Hire of equipment and motor vehicles 81 18 – – Investments in subsidiaries written off – – 610 – Bad debts written off : - advances to subsidiaries – – 1,502 3,402 - others 315 1,060 – 980 Loss on foreign exchange : - realised 54 1,104 – – - unrealised 1,282 2,789 – – Loss on disposal of property, plant and

equipment 186 – 81 – Write-down in value of inventories 73 – – –

Loss on redemption of redeemable convertible preference shares in a subsidiary – – – 35,460 Related company transactions : - Administrative fee charged – – 12,000 12,000


128


32. Employees Information


Staff costs (including directors’ emoluments) comprised :-

Salaries, wages, allowances and leave pay 15,040 11,071 3,930 2,749 Amount contributed under defined contribution plan : - Employees Provident Fund (EPF) 1,681 1,494 693 566 Curtailment of retirement benefits scheme – (630) – (630) Payment made under Voluntary Separation

Scheme 121 1,704 – – Others 1,694 1,194 730 423

18,536 14,833 5,353 3,108

33. Directors’ Remuneration


Directors of the Company : - Fees 192 192 192 192 - Other emoluments 3,804 2,741 3,804 2,741 Directors of subsidiaries : - Other emoluments 1,107 416 – –

5,103 3,349 3,996 2,933 Estimated value of benefits-in-kind of

directors : - The Company 418 440 418 440 - Subsidiaries 79 64 – –

5,600 3,853 4,414 3,373

Annual Report 2011

129


34. Finance Costs


Interest on term loans and other borrowings 17,515 16,481 5,127 5,411 Accretion of interest implicit in long term payables 305 – – – Related company interests – – 117 114

17,820 16,481 5,244 5,525

35. Taxation

Group Company 2011 2010 2011 2010 RM’000 RM’000 RM’000 RM’000 Continuing operations Current year income tax (1,321) (3,616) 396 613 Deferred tax expense/(income) resulting

from origination and reversal of temporary differences 2,242 (6,848) – (1,018)

921 (10,464) 396 (405) Taxation under/(over) provided in prior years : - current income tax 415 (2,822) (118) (3,263) - deferred tax 8 267 – –

Total tax expense/(income) from continuing operations 1,344 (13,019) 278 (3,668)

Discontinued operations Income tax over provided in prior years – (61) – –

Total tax expense/(income) 1,344 (13,080) 278 (3,668)

The general income tax rate in Malaysia for the year under review is 25% (2010 : 25%) of taxable income.


130


35. Taxation (Cont’d)

A reconciliation of tax expense/(income) applicable to profit before taxation at the applicable statutory tax rate to the tax expense/(income) at the effective tax rate of the Group and Company is as follows :-

Group Company 2011 2010 2011 2010 RM’000 RM’000 RM’000 RM’000 Profit before taxation : - from continuing operations 52,331 18,877 76,014 2,317 - from discontinued operations – 3,963 – – Less : Share of results of associates (15,198) (14,644) – –

37,133 8,196 76,014 2,317

Taxation at the rate of 25% (2010 : 25%) 9,283 2,049 19,004 579

Tax effect in respect of :-

Different tax rates in foreign jurisdiction (276) (1) – – Expenses not deductible for taxation purposes 6,745 4,211 25,737 62,424 Income not subject to tax (3,738) (6,023) (44,345) (63,408) Tax savings arising from utilisation of previously

unrecognised unutilised capital allowances and unabsorbed tax losses (3,979) (5,126) – – Deferred tax assets recognised on unabsorbed

tax losses and investment tax allowance (7,848) (6,335) – – Deferred tax assets not recognised 734 761 – – Taxation under/(over) provided in prior years : - current income tax 415 (2,883) (118) (3,263) - deferred tax 8 267 – – Total tax expense/(income) 1,344 (13,080) 278 (3,668) The following are estimated unabsorbed tax losses, unutilised capital allowances and other unutilised tax incentives

which are available for set-off against future taxable income :-


Unabsorbed tax losses 368,104 376,526 1,376 1,376 Unutilised capital allowances 81,601 75,605 59,459 59,740 Unutilised reinvestment allowance 17,315 17,315 17,315 17,315 Unutilised investment tax allowance 26,092 26,092 – –

493,112 495,538 78,150 78,431

Annual Report 2011

131


36. Earnings per Share

36.1 Basic

The basic earnings per share is calculated based on the profit for the year attributable to owners of the Company and is based on the weighted average number of ordinary shares in issue during the financial year.

2011 2010

Profit from continuing operations attributable to owners of the Company (RM’000) 48,681 29,636 Profit from discontinued operations attributable to owners of the Company (RM’000) – 4,024

Profit attributable to owners of the Company (RM’000) 48,681 33,660

Weighted average number of ordinary shares in issue during the financial year (‘000) 574,861 486,663

Basic earnings per share (sen) :

- Profit from continuing operations 8.47 6.09 - Profit from discontinued operations – 0.83 Profit for the year 8.47 6.92

36.2 Diluted

The diluted earnings per share for the current and previous financial year is equal to the basic earnings per share for the respective financial years as there were no outstanding dilutive potential ordinary shares at year-end.

37. Note to the Statements of Cash Flows

Purchase of property, plant and equipment

Property, plant and equipment were acquired by the following means :-

Group Company 2011 2010 2011 2010 RM’000 RM’000 RM’000 RM’000 Cash purchase 725 1,429 136 81 Hire purchase and lease financing 1,118 – 898 – Aggregate cost 1,843 1,429 1,034 81

The principal amount of instalment payments for property, plant and equipment acquired by hire purchase and lease financing are reflected in cash outflows from financing activities.


132


38. Capital and Other Commitment

38.1 Capital commitments

Group 2011 2010 RM’000 RM’000

Approved and contracted for Capital and other expenditure relating to the purchase of investment properties 71,268 –

38.2 Other commitments

Group 2011 2010 RM’000 RM’000

Non-cancellable operating lease commitments

Future minimum IT maintenance fee payable : - Not later than 1 year 398 398 - Later than 1 year and not more than 5 years 687 1,085 Future minimum rental payable : - Not later than 1 year 367 519 - Later than 1 year and not more than 5 years 367 1,686

1,819 3,688

Annual Report 2011

133


39. Contingent Liabilities

Group Company 2011 2010 2011 2010 RM’000 RM’000 RM’000 RM’000 Unsecured corporate guarantees given to licensed banks for facilities granted to subsidiaries - Limit of guarantee – – 314,336 323,536

Amount utilised – – 55,259 83,884

Letters of credits (secured) – 2,826 – – Bank guarantees and performance bonds : - secured 12,745 33,427 – – - unsecured 15,130 24,059 2,352 5,140 Claims by a third party for costs and damages

arising from late delivery of goods and breach of contract, under dispute – 980 – –

27,875 61,292 57,611 89,024

40. Segment Reporting

The Group has three operating segments that are organised and managed separately according to the nature of products and services, specific expertise and technology requirements, which require different business and marketing strategies. The Group’s operations comprise the following business segments :-

(i) Property Property development, property investment and property management services.

(ii) Engineering and Infrastructure Electrical and power engineering contractors and fabrication of electrical equipment, manufacture of power and oil transformers, management of toll operations and maintenance of highway.

(iii) Others Investment holding activities and Group level corporate services and treasury function.

No other operating segments have been aggregated to form the above operating segments.


134


40. Segment Reporting (Cont’d)

As disclosed in Note 20, in the previous financial year, the Group had entered into agreements to dispose of the wholly-owned subsidiaries, Restoran Seri Melayu Sdn. Bhd., RSM Catering And Management Services Sdn. Bhd., Harpers Travel (Malaysia) Sdn. Berhad and Harpers Tours (Malaysia) Sdn. Berhad, (“RSM and Harpers Group”) which operate restaurants and act as travel and tour agencies respectively. As at 31 March 2009, RSM and Harpers Group had been classified as a disposal group and for the purpose of segment reporting, their activities had been presented under Discontinued Operations in the previous financial year. The activities of RSM and Harpers Group had been previously presented under the Travel and Leisure segment.

All inter-segment transactions have been entered into in the ordinary course of business and have been established under negotiated terms and conditions.

40.1 Operating segments

Engineering and Property infrastructure Others Consolidated 2011 RM’000 RM’000 RM’000 RM’000 Segment revenue Total revenue 67,240 51,947 41,439 160,626 Inter-segment revenue (9,175) – (41,340) (50,515) External revenue 58,065 51,947 99 110,111

Segment results Segment results 73,898 387 (20,753) 53,532 Interest income 297 769 355 1,421

Operating profit 74,195 1,156 (20,398) 54,953 Finance costs (13,593) (2,625) (1,602) (17,820) Share of results of associates 2,371 11,673 1,154 15,198 Profit before taxation 62,973 10,204 (20,846) 52,331 Taxation (3,459) (1,370) 3,485 (1,344) Profit for the year 59,514 8,834 (17,361) 50,987

Annual Report 2011

135


40. Segment Reporting (Cont’d)

40.1 Operating segments (Cont’d)

Engineering and Property infrastructure Others Consolidated 2011 (Cont’d) RM’000 RM’000 RM’000 RM’000 Segment assets Segment assets 722,378 92,956 23,985 839,319 Investments in associates – 98,771 28,196 126,967

722,378 191,727 52,181 966,286

Segment liabilities 244,290 50,980 83,389 378,659

Other information Additions to non-current assets consist of : - Property, plant and equipment 595 205 1,043 1,843 - Investment properties 38,372 – – 38,372 - Biological assets 1,028 – – 1,028 - Land held for property development 876 – – 876

40,871 205 1,043 42,119

Depreciation and amortisation 3,937 1,460 479 5,876

Other material items of (income)/expense included in the Group’s profit or loss : - Write back of allowance for impairment in value in respect of land held for property development (45,677) – – (45,677) - Write back of accrued development costs (7,983) – (850) (8,833) - Loss on disposal of an associate – – 10,324 10,324

Non-cash expenses other than

depreciation and amortisation 580 1,564 255 2,399


136


40. Segment Reporting (Cont'd)

40.1 Operating segments (Cont'd) Discontinued Continuing Operations Operations

Engineering and Travel and

Property infrastructure Others Total leisure Consolidated 2010 - Restated RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 Segment revenue Total revenue 104,640 146,386 41,787 292,813 7,724 300,537 Inter-segment revenue (10,477) (109) (41,525) (52,111) (69) (52,180) External revenue 94,163 146,277 262 240,702 7,655 248,357

Segment results Segment results 17,622 (4,989) 6,839 19,472 3,976 23,448 Interest income 302 132 809 1,243 – 1,243 Unallocated expenses (1) – (1) Operating profit 17,924 (4,857) 7,648 20,714 3,976 24,690 Finance costs (6,901) (5,722) (3,858) (16,481) (13) (16,494) Share of results of associates 1,907 8,344 4,393 14,644 – 14,644 Profit before taxation 12,930 (2,235) 8,183 18,877 3,963 22,840 Taxation (236) 5,330 7,925 13,019 61 13,080 Profit for the year 12,694 3,095 16,108 31,896 4,024 35,920

Segment assets Segment assets 660,803 109,939 24,479 795,221 – 795,221 Investments in associates 27,953 92,192 27,680 147,825 – 147,825

688,756 202,131 52,159 943,046 – 943,046

Segment liabilities 260,830 69,324 71,703 401,857 – 401,857

Annual Report 2011

137



40.1 Operating segments (Cont’d) Discontinued Continuing Operations Operations

Engineering and Travel and

Property infrastructure Others Total leisure Consolidated 2010 - Restated (Cont’d) RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 Other information

Additions to non-current assets consist of : - Property, plant and equipment 275 910 100 1,285 143 1,428 - Investment properties 300,519 – – 300,519 – 300,519 - Biological assets 1,095 – – 1,095 – 1,095 - Land held for property development 157 – – 157 – 157 302,046 910 100 303,056 143 303,199

Depreciation and amortisation 1,879 612 732 3,223 26 3,249

Other material items of income included in the Group's profit or loss : - Gain on disposal of associates – – 13,941 13,941 – 13,941 - Write back of impairment on trade and other receivables – 951 3,238 4,189 – 4,189 - Excess of fair value of identifiable assets and liabilities on acquisition of subsidiaries – – 1,753 1,753 – 1,753

Non-cash expenses other

than depreciation and amortisation 531 4,485 1,122 6,138 22 6,160


138



40.2 Geographical information

For the purpose of disclosing geographical information, revenue is based on the geographical location of customers and non-current assets are based on the geographical location of the assets. Non-current assets do not include deferred tax assets and financial instruments.

Continuing operations Discontinued operations Total 2011 2010 2011 2010 2011 2010 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000

Segment revenue Malaysia 81,905 128,032 – 7,655 81,905 135,687 United Kingdom 26,377 13,139 – – 26,377 13,139

United Arab Emirates 1,829 99,531 – – 1,829 99,531 110,111 240,702 – 7,655 110,111 248,357

Segment non-current assets Malaysia 369,377 355,235 – – 369,377 355,235

United Kingdom 293,084 261,893 – – 293,084 261,893 United Arab Emirates 133 101 – – 133 101

662,594 617,229 – – 662,594 617,229

40.3 Information about major customers

Revenue from transactions with major customers who individually accounted for 10% or more of the Group's revenue are as follows :-

2011 2010 RM'000 RM'000 Segments

Customer A 16,958 – Engineering and infrastructure Customer B 14,191 7,114 Properties Customer C – 100,510 Engineering and infrastructure

31,149 107,624

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41. Related Party Transactions

Parties are considered to be related if one party has the ability to control the other party or exercise significant influence over the other party or when both parties are under the common control of another party.

Related party relationships exist between the Company and its subsidiaries and between the Company and its immediate and ultimate holding companies. The details of the subsidiaries are disclosed in Note 45. The Group’s immediate holding company is Amcorp Group Berhad which holds 73% equity interest in the Company. The ultimate holding company of the Group is Clear Goal Sdn. Bhd..

In addition to the related party transactions and balances disclosed elsewhere in the financial statements, the other significant related party transactions and balances are set out below.

41.1 Transactions and year-end outstanding balances between the Company and subsidiaries

(a) Transactions between the Company and the subsidiaries are as follows :-

Company 2011 2010 RM’000 RM’000

Interest charged to subsidiaries 6,741 8,136 Rental of land and buildings charged to subsidiaries 17 17 Interest charged by subsidiaries 117 114 Administrative fees charged by subsidiaries 12,000 12,000 Waiver of debts by subsidiaries 31,642 5,711 Waiver of debts to subsidiaries 1,502 3,402

(b) The year-end outstanding balances with subsidiaries together with their terms and conditions

thereon are disclosed in Notes 17 and 29 to the financial statements.

The amounts receivable from and payable to subsidiaries are expected to be settled in cash. During the financial year, the Company has recorded an impairment loss on amount due from subsidiaries of Nil (2010 : RM1,000,251).

41.2 Transactions and year-end outstanding balances with associates

Details of associates are disclosed in Note 46. The transactions with associates are as follows :-


AM SGB Sdn. Bhd. :- Administrative fee received – 32 – 32 - Sales of air tickets and other related travel services – 34 – –

There were no balances outstanding with associates as at the end of the current financial year.


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41. Related Party Transactions (Cont’d)

41.3 Key management personnel compensation

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Group and Company either directly or indirectly. The key management personnel of the Group and Company are the directors of the Company and their remuneration for the financial year are as follows :-

Group and Company 2011 2010 RM’000 RM’000

Short-term employee benefits 3,379 2,478 Post-employment benefits - contribution to Employees Provident Fund 617 455

3,996 2,933 Benefits-in-kind 418 440 4,414 3,373

41.4 Transactions and year-end outstanding balances with other related parties

(a) The transactions entered into by the Group and the Company with companies in which a substantial shareholder of the Company namely, Tan Sri Dato’ Azman Hashim (“TSDAH”) has substantial financial interests and other related companies

Name of related parties Relationship

AMMB Holdings Berhad Group Group of companies related to TSDAH, a director (“AMMB Holdings Group”) and a deemed substantial shareholder of the group and an associate of Clear Goal Sdn. Bhd. Group

Clear Goal Sdn. Bhd. Group Group of companies related to TSDAH, a director

(“Clear Goal Group”) and a deemed substantial shareholder of the group, the ultimate holding company and its subsidiary excluding MCM Technologies Berhad Group

RCE Capital Berhad Group Group of companies related to TSDAH, a director

(“RCE Capital Group”) and a deemed substantial shareholder of the group and an associate of Clear Goal Sdn. Bhd. Group

MCM Technologies Berhad Group of companies related to TSDAH, a director Group (“MCM Tech Group”) and a deemed substantial shareholder of the group and a fellow subsidiary of Clear Goal Sdn. Bhd. Group

Dato’ Azhar Bin Hashim A person connected to TSDAH

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41.4 Transactions and year-end outstanding balances with other related parties (Cont’d)

(a) (Cont’d)

Name of related parties Relationship

Michael Chen & Co. A company in which Michael Chen, a director is a Consultant

CH Williams Talhar & Wong A company in which P’ng Soo Theng, a director is a Consultant

Blue Star Limited Shareholder of Blue Star M&E Engineering Sdn. Bhd.

Drard Holdings Sdn. Bhd. Shareholder of Mawar Delima Sdn. Bhd.

Fizam Auto Service Sdn. Bhd. A company in which TSDAH and Azian Hashim are substantial shareholders and Azmi Hashim is a director. Azian Hashim is a person connected to TSDAH and Azmi Hashim, a director of the Company

Details of transactions entered into during the financial year are as follows :-

2011 2010 RM’000 RM’000 Group

Sales of air tickets and other related travel services to : - AMMB Holdings Group – 742 - Clear Goal Group – 72 - RCE Capital Group – 77 - MCM Tech Group – 6 Restaurant service provided to : - AMMB Holdings Group – 10 - Clear Goal Group – 1

Purchase of air tickets and related travel services from Clear Goal Group 380 309 Rental income received from AMMB Holdings Group 530 602 Consultancy services charged by AMMB Holdings Group – 364 Rental charged by : - AMMB Holdings Group 87 395 - Clear Goal Group 819 541


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(a) (Cont’d)

2011 2010 RM’000 RM’000 Group (Cont’d)

IT maintenance charged by MCM Tech Group 398 512 Purchase of motor vehicle from Clear Goal Group 491 – Disposal of property,plant and equipment to Clear Goal Group – 437 Consultancy services charged by Clear Goal Group 52 80 Restaurant service provided by Clear Goal Group 13 15

Company

Consultancy services charged by AMMB Holdings Group – 364 Rental charged by Clear Goal Group 101 101 Purchase of motor vehicle from Clear Goal Group 246 – Purchase of air tickets and related travel services from Clear Goal Group 158 – Restaurant service provided by Clear Goal Group 12 –

(b) The transactions entered into with companies or persons connected to Tan Sri Dato’ Azman

Hashim


2011 2010 RM’000 RM’000 Group Upkeep of motor vehicles charged by Fizam Auto Service Sdn. Bhd. 10 24

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(c) The transactions entered into with companies in which a Director has received remuneration


2011 2010 RM’000 RM’000 Group Professional fee paid to Michael Chen & Co. 153 – Professional fee paid to CH Williams Talhar & Wong 23 –

(d) The transactions entered into with minority shareholders of subsidiaries


2011 2010 RM’000 RM’000 Group Technical fees paid to Blue Star Limited 2,239 1,917 Acquisition of ordinary shares in Mawar Delima (M) Sdn. Bhd. from Drard Holdings Sdn. Bhd. – 1,440 Advances from a minority shareholder (GBP8,565,667) (Note 26) – 42,327

42. Significant / Subsequent Events

42.1 On 1 October 2010, the Company announced that the Company had entered into a Sale and Purchase Agreement (“SPA”) with Puncak Exotika Sdn. Bhd. (“PESB”) to dispose 12,000,000 ordinary shares of RM1.00 each in Selaman Sdn. Bhd. (“SSB”), representing 40% of equity interest in SSB for a total cash consideration of RM20,000,000 (“Proposed Disposal”).

The disposal was completed on 9 March 2011.


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42. Significant / Subsequent Events (Cont’d)

42.2 On 13 October 2010, the Company announced that the Company had entered into an Agreement For Sale (“Agreement”) with British Land Offices (Non-City) Limited (“BRLND” or “the Vendor”) to purchase a freehold property known as 95-99 Baker Street, 405 Durweston Mews, London W1, United Kingdom (“the Property”) for a cash consideration of GBP16,250,000 (“Proposed Acquisition”).

The Company nominates its subsidiary, Country Realty Limited to complete the Agreement and to take transfer of the Property.

BRLND will be converting part of the building into residential units with work on the residential scheme scheduled to commence in early 2011 with expected completion in 12 to 18 months thereof. Once completed, the Property will comprise of 19 apartments arranged over 6 upper floors with 2 lettable commercial units across the ground and lower ground floors.

The Company has paid to the solicitors GBP1,625,000 being 10% deposit with another GBP1,625,000 payable in six months time and the balance 80% only upon completion.

42.3 On 21 December 2010, the Company announced that its wholly-owned subsidiary, Riverich Limited (“RIVERICH”), a company incorporated in the British Virgin Islands, had received confirmation from its solicitors in London that RIVERICH had on 20 December 2010 entered into a Contract For Sale of Freehold Land (“Contract”) with Abaca Services Limited (Company No: 1374735) (“ABACA”) to purchase a freehold property at 101, Lexham Gardens, London W8 6JN, United Kingdom (“the Property”) for a cash consideration of GBP7,300,000 (“Proposed Acquisition”).

The proposed acquisition was completed on 20 January 2011.

42.4 On 12 April 2011, the Company wholly-owned indirect subsidiary, Amcorp Industrial City Sdn. Bhd. (formerly known as AMDB Industrial City Sdn. Bhd.) (“AMIC”), had on 12 April 2011 entered into a conditional Sale and Purchase Agreement (“SPA”) with Premier Land Resources Sdn. Bhd. (“PLR”) for the proposed disposal of a parcel of leasehold agriculture land held under PN 89668, Lot 8590, Mukim of Labu, District of Sepang, State of Selangor measuring approximately 521.1 hectares (1,287.67 acres) (“Land”) for a total cash consideration of RM122,328,650 (“Proposed Disposal”).

A deposit of RM12,232,865 representing 10% of the sale consideration was paid upon the execution of the SPA and the balance of the consideration sum shall be paid to AMIC’s solicitors within three (3) months from the unconditional date of the SPA (“Completion Period”).

In the event PLR fails to pay the said balance of the consideration sum within the Completion Period, AMIC shall automatically grant to PLR an extension period of one (1) month provided that AMIC is compensated with interest at the rate of eight per centum (8%) per annum on a daily rest basis calculated on the balance of the consideration sum and this interest shall be paid to AMIC simultaneously with the balance of the consideration sum.

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42.4 (Cont’d)

The SPA is conditional upon :-

(a) AMIC applying for and obtaining the consent to transfer from the state authority and certificate of consent/approval from the Estate Land Board for the transfer of the Land;

(b) PLR applying for and obtaining the consent from Economic Planning Unit, Prime Minister’s Department for the acquisition of the Land (collectively referred to as “Transfer Consents”).

AMIC and PLR covenant to secure the Transfer Consents within five (5) months from the date of the SPA (“Consent Period”) failing which the parties shall agree mutually in writing to a further extension period (“Extended Consent Period”).

(c) In the event the Transfer Consents or any appeal thereof is rejected or refused by the relevant authority subject always to the expiry of the Consent Period or the Extended Consent Period as the case maybe, or upon the expiry of the Consent Period (as the case maybe) the SPA will be terminated.

42.5 On 17 June 2011, a wholly-owned subsidiary of the Company, Living Development Sdn. Bhd. (“LDSB”), entered into a Conditional Sale and Purchase Agreement (“SPA”) with Melawangi Sdn. Bhd. (“MSB”) to acquire 30 retail lots of Amcorp Mall, 10 office lots located within Amcorp Mall, PJ Tower and Amcorp Tower, 7 business suites of Menara Melawangi and 1,454 car park bays, all located within the commercial mixed development known as Amcorp Trade Centre (collectively referred to as “the Property”) for a total cash consideration of RM75,000,000 (‘the Proposed Acquisition”).

The Proposed Acquisition is deemed to be a related party transaction pursuant to the Bursa Malaysia Securities Berhad Main Market Listing Requirements as MSB is a wholly-owned subsidiary of Amcorp Group Berhad, which is also the Company’s immediate holding company.

The completion of the proposed acquisition of the Property is conditional upon obtaining approvals from the shareholders of both MSB and LDSB and from the relevant authorities.

42.6 On 17 June 2011, a wholly-owned subsidiary of the Company, Walleng Enterprises Sdn. Bhd. (“WESB”), entered into a conditional Share Sale and Purchase Agreement (“SSPA”) with Golden Spectre Limited (“GSL”) (WESB and GSL hereinafter collectively referred to as “the Sellers”) and Britel Fund Trustees Limited (“the Purchaser”) to dispose of the 60% equity interest in Westlink Global Investments Limited (“WGIL”) held by WESB. The remaining 40% equity interest in WGIL is held by GSL. WGIL is a property investment company whose principal asset is a commercial property located at 40/50 Eastbourne Terrace, Paddington, London W2 6LG (“the Property”).

The Sellers proposed to dispose of their respective equity interest in WGIL including advances to WGIL to the Purchaser for a sale consideration of GBP77,520,000 provided that the Sellers settle the existing borrowings of WGIL at completion which as at 31 March 2011 stood at GBP32,011,000 (“the Proposed Disposal”). Based on this, the net consideration to the Sellers will be GBP45,509,000 in which WESB’s share at 60% will be approximately GBP27,305,400 (“the Initial Consideration”).


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42.6 (Cont’d)

Over and above that, the Purchaser will pay an additional consideration to the Sellers based on their proportionate shareholdings in WGIL for :-

(a) any remaining net assets in WGIL at completion date other than the Property; and

(b) depending on the outcome of a rent review currently being undertaken for part of the Property. The Sellers are in the midst of conducting a rent review on 40 Eastbourne Terrace which is currently being let out to a single tenant at GBP35 per square feet. In the event the rent review is agreed with the tenant, the Sellers will get an additional consideration of GBP627,150 for every GBP1 per square feet rent above GBP37 per square feet (“the Additional Consideration”).

(The Additional Consideration and together with the Initial Consideration shall hereinafter referred to as “the Total Sale Consideration”).

The Total Sale Consideration will be fully satisfied in cash. Upon the completion of the Proposed Disposal, WGIL will cease to be a subsidiary of the Company.

The Proposed Disposal is conditional upon the approval to be obtained from the shareholders of the Company at an extraordinary general meeting to be convened. The Sellers and the Purchaser have agreed that the SSPA has to be completed on or before 31 October 2011.

Based on the current statement of financial position of WGIL, the Proposed Disposal is expected to result in an estimated net gain of RM66 million to the Group, after taking into account the estimated expenses of RM7.7 million.

43. Financial Instruments

A financial instrument is any contract that gives rise to both a financial asset of one enterprise and a financial liability or equity instrument of another enterprise.

Financial assets of the Group include deposits with licensed banks, cash and bank balances, trade and other receivables and available-for-sale financial assets.

Financial liabilities of the Group include trade and other payables and bank borrowings.

In respect of the Company, financial assets and financial liabilities also include amount due from and amount owing to subsidiaries respectively.

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43. Financial Instruments (Cont’d)

43.1 Financial risk management objectives and policies

The Group’s operations are subject to a variety of financial risks including currency risk, interest rate risk, credit risk, market risk and liquidity and cash flow risks. Risk is defined as uncertain future events which could influence the achievement of the Groups’s objectives.

The Group’s overall financial risk management objective is to seek to address and control the risks to which the Group is exposed and to minimise potential adverse effects on its financial performance that may result from its exposure to such risks and to enhance shareholder value where appropriate.

The Board is primarily responsible for the management of these risks and to formulate policies and

procedures for the management thereof. The risks are managed by regular risk reviews, internal control systems, on-going formulation and adherence to financial risk policies and mitigated by insurance coverage where appropriate. Various risk management actions are taken depending on the assessment of the impact and likelihood of the risk.

(a) Credit risk

Credit risk is the risk of financial loss attributable to default on obligations by parties contracting with the Group. The Group’s main exposure to credit risk is in respect of its trade receivables.

The Group seeks to control credit risk by spelling out the guidelines and procedures on extending credit terms to customers. Customers’ risk profile are reviewed regularly with a view to setting appropriate terms of trade and credit limits. Where appropriate, customers may be required to provide security and advance payment before goods or services are rendered. The Group has endeavoured to avoid concentration of risk in one customer or a group of customers.

The Group avoids, where possible, any significant exposure to a single customer. However, in the ordinary course of business, certain subsidiaries in the Group’s Engineering and Infrastructure Segment namely AMBC Transmission Sdn. Bhd. and Amcorp Perting Hydro Sdn. Bhd. have trade receivables that are solely from their offtakers, the national electricity utilities companies. As such, the counter party risk is considered to be minimal.

The maximum exposure to credit risk without taking into consideration any collateral held or other credit enhancement is represented by the carrying amount of financial assets in the financial statements, net of impairment allowance. None of the Group’s financial assets are secured by collateral or other credit enhancements.

The Group’s management considers that the financial assets that are not impaired or past due as at the end of the reporting period are of good credit quality. The credit risk for cash and cash equivalents is considered negligible, since the counterparties are reputable banks with high quality external credit ratings.


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43.1 Financial risk management objectives and policies (Cont’d)

(b) Liquidity and cash flow risks

Liquidity or funding risk is the risk of the inability to meet commitments associated with financial instruments while cash flow risk is the risk of uncertainty of future cash flow amount associated with a monetary financial instrument.

The Group practices prudent liquidity risk management to minimise the mismatch of financial assets and liabilities. The Group’s cash flow is reviewed regularly to ensure that the Group is able to settle its commitments when they fall due.

The Group manages its liquidity risk with the view to maintaining a healthy level of cash and cash equivalents approriate to the operating environment and expected cash flows of the Group. Liquidity requirements are maintained within its undrawn committed borrowing facilities at all times and are sufficient and available to the Group to meet its obligations. The Group maintains a mix of short-term money market borrowings and medium/long term loans to fund working capital requirements, capital expenditure and long term projects.

Maturity analysis

The table below summarises the maturity profile of the Group’s and of the Company’s financial liabilities based on contractual undiscounted repayment obligations.

On demand or within Between 2 More than

one year to 5 years 5 years Total RM’000 RM’000 RM’000 RM’000

Group Trade payables 43,137 2,648 – 45,785 Other payables 50,089 – – 50,089 Bank borrowings 89,170 161,545 18,124 268,839 Hire purchase creditors 542 1,290 – 1,832

Total undiscounted financial liabilities 182,938 165,483 18,124 366,545

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(b) Liquidity and cash flow risks (Cont’d)

On demand or within Between 2 More than

one year to 5 years 5 years Total RM’000 RM’000 RM’000 RM’000

Company Other payables 834 – – 834 Amount owing to subsidiaries 137,573 – – 137,573 Bank borrowings 80,462 – – 80,462 Hire purchase creditors 319 893 – 1,212 Total undiscounted financial liabilities 219,188 893 – 220,081

(c) Foreign currency risk

The Group is exposed to foreign currency risk when the Company or its subsidiaries enter into transactions that are not denominated in their functional currencies. The Group attempts where necessary to limit its exposure for committed transactions by entering into forward foreign currency exchange contracts within the constraints of market and government regulations.

The Group’s principal foreign currency exposure as at the end of the reporting period related mainly to receivables, cash and bank balances and payables denominated in Pound Sterling (“GBP”) and United Arab Emirates Dirham (“AED”). The Group’s and the Company’s foreign currency exposure profiles in respect of their financial assets and financial liabilities are disclosed in the following notes.

The Group minimises foreign currency risk by closely monitoring the movements in the exchange rates and where appropriate, measures are implemented with a view to limit risks due to exposures and fluctuations.

As at the end of the financial year, no forward foreign currency exchange contracts were entered into as the timing of the receivables are uncertain or are intended to settle obligations or further investments in the same currency.

The Group does not speculate in foreign currency derivatives and in line with FRS 7, does not regard its investments in foreign operations/subsidiaries as subject to foreign exchange risk.


150




(c) Foreign currency risk (Cont’d)

The Group’s exposure to foreign currencies in respect of its financial assets and financial liabilities is as follows :-

GBP AED Others Total RM’000 RM’000 RM’000 RM’000 Financial assets Trade and other receivables 16,045 9,951 – 25,996 Deposits, cash and balances 516 1,822 – 2,338

16,561 11,773 – 28,334

Financial liabilities Trade and other payables (144) (357) (1,128) (1,629)

Net currency exposure 16,417 11,416 (1,128) 26,705

Included in trade and other receivables is a loan of RM16,018,719 receivable from subsidiaries whose functional currency is denominated in Sterling Pound (“GBP”). As such, any strengthening in GBP will give rise to a gain in foreign exchange in the profit or loss of the subsidiaries which are consolidated in the Group.

The Company is not exposed to any material foreign exchange risk.

Foreign currency risk sensitivity analysis

The following demonstrates the sensitivity of the Group’s profit after tax to 5% strengthening in the GBP and AED against the RM, with all other variables, in particular interest rates, are held constant and based on the financial assets and financial liabilities that are exposed to foreign currency risk as at the end of the reporting period :-

Increase

RM’000 GBP against RM 821 AED against RM 571

A 5% weakening of the above currencies against the respective functional currencies would have

the equal but opposite effect to the amount shown above, on the basis that all other variables remain constant.

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(d) Interest rate risk

The Group is a net borrower of funds and is exposed to interest rate risk for changes in interest rates primarily for floating rate debt obligations and placements in money market. The Group finances its operations by a mixture of internal funds and bank borrowings. The interest rate profile of borrowings is regularly reviewed against prevailing and anticipated market interest rates. The interest, repayment and maturity profiles of borrowings are structured after taking into account on whether funds used are short-term or long-term and the interest rate outlook and the matching cashflows that are used to service the interest and the economic life of the assets or operations being financed. Where necessary, the Group would manage its cashflow interest rate risk by using floating-to-fixed interest rate swaps.

Approximately, 67% of the Group’s borrowings are at fixed rates which were entered into in respect of the Group’s investments in commercial properties in London and a mini hydro power plant.

Interest rate risk sensitivity analysis

If annual interest rates have been 50 basis points higher/lower respectively, with all other variables being held constant and based on borrowings with floating rates as at the end of the reporting period, the profit of the Group and of the Company for the current financial year will be lower/higher by RM297,812 and RM301,732 respectively as a result of increase/decrease in interest expense on those borrowings. The sensitivity analysis for the Group has been prepared on the basis of the Group’s net exposure to interest rate risk after setting off its floating rate borrowings with fixed deposits available as at the end of the reporting period.

(e) Other price risk

The Group is exposed to equity price risk fluctuations arising from its investments in quoted shares, bonds and trust units, which are classified as available-for-sale financial assets. These investments are carried in the books at their quoted or observable market prices which is disclosed in Note 8.

Equity price sensitivity analysis

The Group has considered the sensitivity of these financial instruments to market risk and are of the view that its impact is insignificant.


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43.2 Financial instruments by category

The carrying amounts of financial assets presented in the statements of financial position are based on the measurement categories as defined in FRS 139. All financial assets are categorised as loans and receivables except for certain investments which are categorised as available-for-sale financial assets as disclosed in Note 8.

The carrying amounts of financial liabilities presented in the statements of financial position are based on the measurement categories as defined in FRS 139. All financial liabilities are categorised as financial liabilities measured at amortised cost.

43.3 Fair values of financial instruments

The fair value of a financial instrument is the amount at which the instruments could be exchanged or settled in an orderly manner between knowledgeable and willing parties in an arm’s length transaction. The information presented herein represents estimates of fair values as at the end of the reporting period.

Quoted market prices, when available, are used as the measure of fair values. For unquoted financial instruments and long term receivables, fair values are estimated using net present value or other valuation techniques which involve a certain degree of uncertainty depending on the assumption used and judgements made regarding risk characteristics, discount rates, estimates of future cash flows and other factors. Changes in these assumptions could materially affect these estimates and the resulting fair value.

Fair value information for property, plant and equipment and investments in subsidiaries and associates are excluded as they do not fall within the scope of FRS 132 which requires fair values to be disclosed.

The fair values of the financial assets and financial liabilities reported in the statements of financial position approximate the carrying amounts of those assets and liabilities because of the limited terms to maturity of these financial instruments, except for the following :-

Group Company Carrying Fair Carrying Fair

amount value amount value RM’000 RM’000 RM’000 RM’000 2011

Financial liabilitiesHire purchase creditors 1,832 1,851 1,212 1,224

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43.3 Fair values of financial instruments (Cont’d)

Group Company Carrying Fair Carrying Fair

amount value amount value RM’000 RM’000 RM’000 RM’000 2010 Financial assets Investments in quoted shares and trust units 1,047 1,679 646 804 Financial liabilitiesHire purchase creditors 1,430 1,142 679 616 Shareholder’s loan 42,327 30,179 – –

It is not practicable to estimate the fair values of contingent liabilities reliably, the notional amount which is disclosed in Note 39, due to the uncertainties of timing, costs and events outcome.

The fair value estimates were determined by application of the methods and assumptions described below :-

Investments For quoted investments, the estimated fair values are generally based on quoted market prices or dealer

quotes. For unquoted investments, fair values has been assessed by reference to market indicative interest yields or net tangible assets where applicable.

Receivables and Borrowings

The fair values of receivables and term loans are estimated using the discounted cash flow analysis based on current lending/borrowing rates for similar types of lending/borrowing arrangements.

44. Capital Management Policy

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern and to maintain an optimal capital structure so as to provide returns for shareholders and benefits for other stakeholders.

In order to optimise the capital structure, or the capital allocation amongst the Group’s various businesses, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares, buy back issued shares, take on new debts or sell assets to reduce debt.


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44. Capital Management Policy (Cont’d)

The Group monitors capital utilisation on the basis of the gearing ratio. This ratio is calculated as total debts divided by total capital. Total debt is calculated as total borrowings (including ‘short term and long term borrowings’ as shown in the statement of financial position). Total capital is calculated as the sum of total equity and total debt.

The gearing ratio as at 31 March 2011 is as follows :-

Group 2011 2010 RM’000 RM’000 Total debts 270,671 264,600 Total equity 570,433 525,208 Total capital 841,104 789,808

Gearing ratio 32.18% 33.50%

The Group has complied with the requirements of Practice Note 17/2005 issued by the Bursa Malaysia Securities Berhad whereby the Group is required to maintain a consolidated shareholders’ equity equal to or not less than 25% of its issued and paid-up capital and such shareholders’ equity is not less than RM40 million.

45. List of Subsidiary Companies

Effective Country of Equity Interest (%) Direct Subsidiary Companies Principal Activities Incorporation 2011 2010

AMBC Transmission Sdn. Bhd. Electrical and Malaysia 85 85 power engineering

construction

AMBC Controls Sdn. Bhd. Fabrication of Malaysia 100 100 electrical equipment

AMCE Builders Sdn. Bhd. * Construction Malaysia – 70

(Struck off during the financial year)

Amcorp Prima Realty Sdn. Bhd.* Property Malaysia 100 100 development

* Subsidiary companies not audited by FOLKS DFK & CO.

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45. List of Subsidiary Companies (Cont’d)


Amcorp Equipment Trading Contracting and Malaysia 100 100 Sdn. Bhd. investment in

(Formerly known as securities AMDB Equipment Trading Sdn. Bhd.)

Amcorp Leisure Holding Investment holding Malaysia 100 100 Sdn. Bhd.

(Formerly known as AMDB Leisure Holdings

Sdn. Bhd.)

Amcorp Management Services Financial, Malaysia 100 100 Sdn. Bhd. property and

(Formerly known as management AMDB Management Services services

Sdn. Bhd.)

Amcorp Power Sdn. Bhd. Investment holding Malaysia 100 100 (Formerly known as AMDB Power Sdn. Bhd.)

Amcorp Property Holdings Investment holding Malaysia 100 100 Sdn. Bhd.

(Formerly known as AMDB Property Holdings Sdn. Bhd.) *

Amcorp Property Management Property Malaysia 100 100 Co. Sdn. Bhd. management (Formerly known as services

AMDB Property Management Co. Sdn. Bhd.)

Amcorp Realty Sdn. Bhd. Property investment Malaysia 100 100 (Formerly known as AMDB Realty Sdn. Bhd.)



156




Arab-Malaysian-Toda Construction Malaysia 51 51 Construction Sdn. Bhd.

(Company in liquidation)

Blue Star M & E Engineering Engineering Malaysia 51 51 Sdn. Bhd. services

Cemara Angkasa Sdn. Bhd. Dormant Malaysia 100 100 (Formerly known as

AMDB Engineering Services Sdn. Bhd.)

Cemara Harapan Sdn Bhd Property investment Malaysia 100 100 (Formerly known as and investment

AMDB Properties Sdn. Bhd.) holding

Cemara Sejati Sdn. Bhd. Investment holding Malaysia 100 100 (Formerly known as

AMDB Technics Sdn. Bhd.)

Country Realty Limited Property British Virgin 100 – investments Islands

Distrepark Sdn. Bhd.* Property Malaysia 100 100 development

Gerak Rasmi Sdn. Bhd. Investment holding Malaysia – 100 (Struck off during the financial year)

HDCam Sdn. Bhd. Property Malaysia 60 60 (Formerly known as development

HDC-Amcorp JV Sdn. Bhd.) *

Hornbeam Sdn. Bhd. Dormant Malaysia 100 100

Ideal Resort Sdn. Bhd. Property investment Malaysia – 70 (Liquidated)


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Jelas Warna Sdn. Bhd. Garments Malaysia – 70 (Struck off during the financial year) manufacturer and

trading

Living Development Sdn. Bhd. Property Malaysia 100 100 development

Mawar Delima (M) Sdn. Bhd. Property Malaysia 100 100 development

Medan Delima Sdn. Bhd. * Property Malaysia 100 100 development

and management

Mekar Angkasa Sdn. Bhd. Investment holding Malaysia 100 100

Perumahan Taman Pinji Property Malaysia 100 100 Sdn. Bhd. * development

Pulau Indah Marina Resort Property Malaysia 60 60 Sdn. Bhd. development

Regal Genius Sdn. Bhd. * Property Malaysia 100 100 development

Riverich Limited Property British Virgin 100 – investments Islands Sejati Pelita Sdn. Bhd. * Property Malaysia 100 100 development

Selaju Sdn. Bhd. Investment holding Malaysia 100 100

Seng Hock Realty Property Malaysia 100 100 Development Sdn. Bhd. * development and property investment



158




Syarikat Kompleks Damai Property Malaysia 100 100 Sdn. Bhd. development and property investment

Taifab Hongkong Ltd. * General trading Hong Kong, – 100 (Deregistered during the financial year) Republic of

China Taifab Properties Sdn. Bhd. Property Malaysia 100 100 development, property

management and property investment

Taifab Trading (M) Sdn. Bhd. Investment and Malaysia – 100 (Struck off during the financial year) trading in securities

Walleng Enterprises Sdn. Bhd. Investment holding Malaysia 100 100 and property development

Zaklan Sdn. Berhad Investment holding Malaysia 100 100

AMDB Commercial Services Licensed money Malaysia 100 100 Sdn. Bhd. lender

Amcorp Industrial City Sdn. Bhd. Property Malaysia 100 100 (Formerly known as development

AMDB Industrial City Sdn. Bhd.)

Amcorp Perting Hydro Sdn. Bhd . Own, operate and Malaysia 100 100 (Formerly known as maintain a

AMDB Perting Hydro Sdn. Bhd.) renewable energy power plant

Amcorp Services Sdn. Bhd. Property Malaysia 100 100 (Formerly known as development and AMDB Land Sdn. Bhd.) management services


Annual Report 2011

159



Effective Country of Equity Interest (%) Direct Subsidiary Companies Principal Activities Incorporation 2011 2010 Arnica Corporation Sdn. Bhd. * Property Malaysia 100 100 development

Beringin Indah Sdn. Bhd. Dormant Malaysia 100 100 (Struck off during the financial year)

Cemara Angsana Sdn. Bhd. Management Malaysia 100 100 (Formerly known as services AMDB Power Services Sdn. Bhd.)

Exotic Enterprise Sdn. Bhd. Property Malaysia 100 100 development and property investment

Gubahan Ceria Sdn. Bhd. Dormant Malaysia 100 100

Kaktus Ceria Sdn. Bhd. Dormant Malaysia 100 100 (Struck off during the financial year)

Kaktus Permai Sdn. Bhd. Dormant Malaysia 100 100 (Struck off during the financial year)

Mayang Zaman Sdn. Bhd. Property Malaysia 100 100 development

Netcoin Sdn. Bhd. * Investment holding Malaysia 97 97 Nikmat Segar (M) Sdn. Bhd. Dormant Malaysia 100 100

Rich Avenue Sdn. Bhd. * Property Malaysia 100 100 development

Westlink Global Investments Property British Virgin 60 60 Limited * # investments Islands

* Subsidiary companies not audited by FOLKS DFK & CO. # Audited by an affiliate of FOLKS DFK & CO.


160


46. List of Associated Companies

Effective Country of Equity Interest (%) Direct Associated Companies Principal Activities Incorporation 2011 2010

Kesas Holdings Berhad Investment holding Malaysia 20 20

Planergo (Pte) Limited Hotel operation Republic of 20 20 Singapore

Prisma Tulin Sdn. Bhd. Hotel operation Malaysia 41 41 Lafarge Concrete (Malaysia) Manufacture Malaysia 30 30 Sdn. Bhd. of ready mixed

concrete

Indirect Associated Companies

Augustland Hotel Sdn. Bhd. Hotel and apartment Malaysia 40 40 development and operation AmTrustee Berhad Trustee service Malaysia 20 20

Bangi Hotel Sdn. Bhd. Development, Malaysia 20 20 construction, management and maintenance of hotel

Kesas Sdn. Bhd. Management of Malaysia 20 20 toll operations and maintenance of highway

Lafarge Concrete Industries Producer and Malaysia 30 30 Sdn. Bhd. seller of ready- mixed concrete

Lafarge Concrete (East Manufacture and Malaysia 30 30 Malaysia) Sdn. Bhd. sale of ready-mixed concrete

Annual Report 2011

161


47. Supplementary Information Disclosed Pursuant to Bursa Malaysia Securities Berhad’s Listing Requirements

Realised and unrealised profits or losses

The breakdown of retained profits of the Group and of the Company as at 31 March 2011, into realised and unrealised profits or losses pursuant to the directive issued by Bursa Malaysia Securities Berhad dated 25 March 2010, is as follows :-

Group Company 2011 2011 RM’000 RM’000 Total retained profits of the Company and its subsidiaries : - Realised 184,605 91,454 - Unrealised 844 –

185,449 91,454 Total share of retained profits from associates : - Realised (19,608) – - Unrealised 1,189 –

167,030 91,454 Add : Consolidation adjustment 20,536 –

Retained profits as per financial statements 187,566 91,454


162

In the opinion of the Directors, the financial statements set out on pages 39 to 161 are drawn up in accordance with Financial Reporting Standards and the provisions of the Companies Act, 1965 in Malaysia so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 March 2011 and of the results of operations and cash flows of the Group and of the Company for the year ended on that date.

AZMI HASHIM LEE KEEN PONGExecutive Chairman Executive Director / Chief Executive Officer Date : 23 June 2011

Statement by Directors

Statutory Declaration

I, YAP CHOON SENG, being the Officer responsible for the financial management of AMCORP PROPERTIES BERHAD (formerly known as AMDB BERHAD), do solemnly and sincerely declare that to the best of my knowledge and belief, the financial statements set out on pages 39 to 161 are correct, and I make this solemn declaration conscientiously believing the same to be true, and by virtue of the provisions of the Statutory Declarations Act, 1960.

Subscribed and solemnly declared by )YAP CHOON SENG at Petaling Jaya in )the state of Selangor Darul Ehsan on )23 June 2011 ) YAP CHOON SENG Before me,

COMMISSIONER FOR OATHS

Annual Report 2011

163

Independent Auditors’ Reportto the Members of Amcorp Properties Berhad (formerly known as AMDB Berhad)

Report on the Financial Statements

We have audited the financial statements of Amcorp Properties Berhad (formerly known as AMDB Berhad), which comprise the statements of financial position as at 31 March 2011 of the Group and of the Company, and the statements of comprehensive income, statements of changes in equity and statements of cash flows of the Group and of the Company for the year then ended, and a summary of significant accounting policies and other explanatory information, as set out on pages 39 to 160.

Directors' Responsibility for the Financial Statements

The directors of the Company are responsible for the preparation of financial statements that give a true and fair view in accordance with Financial Reporting Standards and the Companies Act, 1965 in Malaysia, and for such internal control as the directors determine is necessary to enable the preparation of the financial statements that are free from material misstatement, whether due to fraud or error.

Auditors' Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgement, including the assessment of risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the entity’s preparation of financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements have been properly drawn up in accordance with Financial Reporting Standards and the Companies Act, 1965 in Malaysia so as to give a true and fair view of the financial position of the Group and of the Company as at 31 March 2011 and of their financial performance and cash flows for the year then ended.


164

Independent Auditors’ Reportto the Members of Amcorp Properties Berhad (formerly known as AMDB Berhad)

Report on Other Legal and Regulatory Requirements

In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report the following :-

(a) In our opinion, the accounting and other records and the registers required by the Act to be kept by the Company and its subsidiaries of which we have acted as auditors have been properly kept in accordance with the provisions of the Act.

(b) We have considered the financial statements and the auditors’ reports of all the subsidiaries of which we have not acted as auditors, which are indicated in Note 45 to the financial statements.

(c) We are satisfied that the financial statements of the subsidiaries that have been consolidated with the Company’s financial statements are in form and content appropriate and proper for the purposes of the preparation of the financial statements of the Group and we have received satisfactory information and explanations required by us for those purposes.

(d) The audit reports on the financial statements of the subsidiaries did not contain any qualification or any adverse comment made under Section 174(3) of the Act.

Other Reporting Responsibilities

The supplementary information set out in Note 47 on page 161 is disclosed to meet the requirement of Bursa Malaysia Securities Berhad. The directors are responsible for the preparation of the supplementary information in accordance with Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants (“MIA Guidance”) and the directive of Bursa Malaysia Securities Berhad. In our opinion, the supplementary information is prepared, in all material respects, in accordance with the MIA Guidance and the directive of Bursa Malaysia Securities Berhad.

Other Matters

This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the Companies Act, 1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.

FOLKS DFK & CO. NG ENG KIAT No. : AF 0502 No. : 1064/03/13(J/PH) Chartered Accountants Chartered Accountant

Kuala Lumpur Date : 23 June 2011

Annual Report 2011

165

Analysis of Shareholdings As at 5 August 2011

Authorised Capital : RM500,000,000.00Issued and Paid-Up Capital : RM287,730,718.50Class of Shares : Ordinary shares of RM0.50 each Voting Rights : One (1) vote per shareholder on show of hands or one (1) vote per ordinary share on a poll

DISTRIBUTION OF SHAREHOLDINGS

No. of % of No. of % ofSize of Shareholdings Shareholders Shareholders Shares Shares Less than 100 3,472 9.45 98,335 0.02100 to 1,000 19,446 52.92 10,303,040 1.801,001 to 10,000 12,205 33.22 37,673,058 6.5710,001 to 100,000 1,483 4.04 39,703,299 6.93100,001 to less than 5% of issued shares 133 0.36 67,930,360 11.855% and above of issued shares 3 0.01 417,372,745 72.83

Total 36,742 100.00 573,080,837 100.00

THIRTY LARGEST REGISTERED SHAREHOLDERS No. Name of Shareholders No. of Shares % 1. Amcorp Group Berhad 341,372,745 59.57

2. EB Nominees (Tempatan) Sendirian Berhad 43,000,000 7.50 - Pledged Securities Account for Amcorp Group Berhad

3. ECML Nominees (Tempatan) Sdn Bhd 33,000,000 5.76 - Pledged Securities Account for AmcorpGroup Berhad

4. Azlan bin Hashim 4,900,000 0.86

5. CIMB Group Nominees (Tempatan) Sdn Bhd 4,444,445 0.78 - Exempt AN for BHLB Trustee Berhad

6. Blue Ribbon International Limited 4,279,834 0.75

7. Raja Karib Shah bin Shahrudin 3,347,267 0.58

8. Soo Ngik Gee @ Soo Yeh Joo 3,181,200 0.56

9. Nor Azrini binti Azlan 3,000,000 0.52

10. Citigroup Nominees (Asing) Sdn Bhd 2,749,237 0.48 - Exempt AN for OCBC Securities Private Limited (Client A/C-NR)


166

No. Name of Shareholders No. of Shares % 11. Chow Soi Wah 1,894,100 0.33

12. Tan Yu Wei 1,749,367 0.31

13. CIMSEC Nominees (Asing) Sdn Bhd 1,514,025 0.26 - Exempt AN for CIMB Securities (Singapore) Pte Ltd (Retail Clients) 14. CIMSEC Nominees (Tempatan) Sdn Bhd 1,455,600 0.25 - CIMB Bank for Mak Ngia Ngia @ Mak Yoke Lum 15. Low Pek Kok 1,236,000 0.22

16. Toh Ean Hai 1,175,000 0.21

17. HLG Nominee (Asing) Sdn Bhd 1,102,764 0.19 - Exempt AN for UOB Kay Hian Pte Ltd (A/C Clients)

18. Adam Shah bin Azlan 1,100,000 0.19

19. Citigroup Nominees (Asing) Sdn Bhd 1,047,267 0.18 - CBNY for Dimensional Emerging Markets Value Fund

20. Alfa Erat Sdn Bhd 1,000,000 0.17

21. Neo Soon Chong 1,000,000 0.17

22. Public Invest Nominees (Asing) Sdn Bhd 881,173 0.15 - Exempt AN for Phillip Securities Pte Ltd (Clients)

23. Kenanga Nominees (Tempatan) Sdn Bhd 779,667 0.14 - Pledged Securities Account for Mary Ting Siew Ding

24. Low Mei Lan 733,333 0.13

25. Gan Kai San 720,000 0.13

26. Citigroup Nominees (Asing) Sdn Bhd 716,033 0.12 - CBNY for DFA Emerging Markets Small Cap Series

27. Low Pek Lay 680,900 0.12

28. Wong Tuck Lee 600,000 0.10

29. HDM Nominees (Asing) Sdn Bhd 572,333 0.10 - UOB Kay Hian Pte Ltd for Pax Realty & Development Pte Ltd

30. Mayban Nominees (Tempatan) Sdn Bhd 550,000 0.10 - Pledged Securities Account for Liew Sun Yick


Annual Report 2011

167


SUBSTANTIAL SHAREHOLDERS

Direct Interest Indirect InterestName of Substantial Shareholders No. of Shares % No. of Shares % Tan Sri Azman Hashim 158,359 0.03 417,372,745 (1) 72.83Amcorp Group Berhad 417,372,745 72.83 – –Clear Goal Sdn Bhd – – 417,372,745 (1) 72.83

Note:(1) Deemed interested by virtue of Section 6A of the Companies Act, 1965 through shareholdings in Amcorp Group Berhad.

DIRECTORS’ SHAREHOLDINGS

Direct Interest Indirect InterestName of Directors No. of Shares % No. of Shares % Azmi Hashim 17,667 –# – –

Note:# Negligible

Note: The analysis of shareholdings is based on the Record of Depositors as at 5 August 2011, net of 2,380,600 treasury shares.


168

List of PropertiesHeld as at 31 March 2011

Approximate Net Book Date of Area Expiry Description/ Age of Value Acquisition/Properties (m2) Tenure Date Existing Use Buildings RM'000 Revaluation Lot 627 Section 47 179 Freehold N/A Police beat base 16 years – 07.08.1981Wilayah Persekutuan Kuala Lumpur GM 3030, to the north of 886 Freehold N/A Vacant land N/A – 17.11.1983Taman Desa Off Jalan Klang Lama Kuala Lumpur PT 17384-5, 17388-90, 1,858 Freehold N/A Terraced 12 Years 590 10.12.198417406, 17452 Nilai factories and Negeri Sembilan Darul Khusus residential

Lot 3324, Mukim of Labu 5,419,225 Leasehold 14.09.2080 Agricultural N/A 67,471 20.06.2002Sepang, Selangor Darul Ehsan 99 years land Geran 10546, Lot 5333 392 Freehold N/A Vacant land N/A 1 17.05.1978Mukim Bukit Baru Melaka Tengah, Melaka PT 26945-27160 674,235 Freehold N/A Land held N/A 25,987 20.06.2002Mukim of Setul for future Negeri Sembilan Darul Khusus development Lot 1577 & 1578 16,956 Freehold N/A Land N/A 8,911 01.04.2007Mukim of Petaling held under District of Kuala Lumpur development Wilayah Persekutuan Kuala Lumpur Lot 572, 1009, 1063 269,513 Freehold N/A Land held N/A 7,009 23.12.1992Daerah Kota Tinggi for future Mukim Pengerang development Johor Darul Takzim HS(D) 159736-47 6,835 Freehold N/A Land held N/A 1,104 03.04.1997PT No. 7753-64 for future Bandar Seremban, development Negeri Sembilan Darul Khusus

Annual Report 2011

169

Approximate Net Book Date of Area Expiry Description/ Age of Value Acquisition/Properties (m2) Tenure Date Existing Use Buildings RM’000 Revaluation

Geran 70371/M1/2/17-18, 3,516 Freehold N/A Commercial 12 Years 4,977 28.03.1994Geran 70371/M1/3/32, (net lettable) buildings Geran 70371/M1/4/49-52, Geran 70371/M1/5/57-60, Geran 70371/M1/5/63, Geran 70371/M1/6/71-77 Seremban City Centre Jalan Pasar, 70000 Seremban Negeri Sembilan Darul Khusus

G117251/M1/1/43, 306 Freehold N/A Apartments 13 Years 961 23.12.1992G117251/M1/2/2 (Built up) Waterfront Classic I Daerah Kota Tinggi Mukim Pengerang Johor Darul Takzim Lot 1067 Apartment H81 & H85 342 Freehold N/A Apartment 25 years 101 17.05.1985Fraser Pine Resort, Fraser Hill (Built-up) Pahang Darul Makmur D132 & D133 152 Freehold N/A Apartment 25 years 149 08.04.1985Tanjung Biru Apartment (Built-up) Bt 10 Jalan Pantai Port Dickson Negeri Sembilan Darul Khusus 43 Jalan Besar Tanah Rata 486 Leasehold 06.06.2057 Shophouse 26 years 558 24.04.1984Cameron Highlands (Built-up) Pahang Darul Makmur Lot 1167, Batu 10 1,144 Freehold N/A Bungalow 50 years 773 23.09.1986Tanjung Biru (Built-up) Port Dickson Negeri Sembilan Darul Khusus Lot 3204/05/53/67 432 Leasehold 17.09.2056 3 & 4 storey 6 years 1,600 05.08.2009Menyan Land District shophouse Sibu Jaya

Lot 1205-08, 1210-13, 3321, 3323 136,535 Leasehold 17.09.2056 Land N/A 5,016 05.08.2009Block 1, Menyan Land District held under Sibu Jaya development



170


Approximate Net Book Date of Area Expiry Description/ Age of Value Acquisition/Properties (m2) Tenure Date Existing Use Buildings RM’000 Revaluation

Lot 153-4,167-9,171,326,621, 2,696,037 Freehold 17.09.2056 Land N/A 35,039 05.08.2009837,1176, 1191, 1193, 1198, & held under 1209,1213-23, 1225-30, 5647, Leasehold development 5652, 5654, 5656, 5658, 5660-1, 99 years 1636, 1639-42, 5323 Menyan Land District Sarawak

Lot 11, 12, 40748 & 40752 12,556 Leasehold 15.03.2087 Vacant land N/A 2,235 05.08.2009Section 12 99 years Mukim of Klang Selangor Darul Ehsan

HS(D) 103484, PT 1525 33,516 Leasehold 25.05.2092 Clubhouse 6 3,259 05.08.2009Daerah Petaling 99 years Selangor Darul Ehsan

No. 2 Jalan Merah Saga Dua U9/B 910 Leasehold 25.05.2092 Bungalow 7 968 05.08.200940150 Shah Alam 99 years Selangor Darul Ehsan

PT 1211, 1318/19/51/54/93/97, 679,156 Leasehold 25.05.2092 Land N/A 145,899 05.08.20091421/39/47/51/55/71/75/85/86, 99 years held under 1490/92/93/97/98, 1500/01, development 1511-15, 1520-24, 1526, 1541/43, 1548/50/52/58/65/70/73-81, 1584-90, 1593, 1600/4/5/6/12/13, 1616-20/22/23, 1625-30/35/38/42, 1644-46/49-51/53/58/62/64/86, 1691-1702, 1719-21, 1726/29, 1734-1744, 1750-53, 1755, 1765-1832 , 17878 -17919, 20060-72, 20075 Daerah Petaling Selangor Darul Ehsan

40/50 Eastbourne Terrace 13,642 Freehold N/A Commercial 60 52,354 23.09.2009Paddington, London W2 6LG (net lettable) OfficeUnited Kingdom

101, Lexham Gardens, 772 Freehold N/A Residential 6 37,964 20.12.2010London W8 6JN (net lettable) United Kingdom

Annual Report 2011

171

Notice of Annual General Meeting

NOTICE IS HEREBY GIVEN THAT the Forty-Fifth Annual General Meeting of Amcorp Properties Berhad will be held at Tun Rahah Grand Hall, 1st Floor, Menara Yayasan Tun Razak, 200 Jalan Bukit Bintang, 55100 Kuala Lumpur on Wednesday, 21 September 2011 at 10.30 a.m. for the following purposes:

AGENDA

AS ORDINARY BUSINESS 1. To receive the Audited Financial Statements for the financial year ended 31 March 2011

together with the Reports of the Directors and Auditors thereon. 2. To approve the payment of Directors' fees of RM192,000 for the financial year ended

31 March 2011. 3. To re-elect the following Directors who retire pursuant to Article 136 of the Company’s

Articles of Association: (i) Puan Shalina Azman(ii) Y. Bhg. Tan Sri Lee Lam Thye(iii) Encik Shahman Azman

4. To consider and if thought fit, to pass the following resolution:

“THAT Y. Bhg. Tan Sri Dato’ Chen Wing Sum retiring pursuant to Section 129(6) of the Companies Act, 1965 be and is hereby re-appointed as Director of the Company to hold office until the next Annual General Meeting.”

5. To appoint Auditors and to authorise the Directors to fix their remuneration.

Notice of Nomination pursuant to Section 172(11) of the Companies Act, 1965, a copy of which is annexed hereto and marked ‘Annexure A’ in the Annual Report, has been received by the Company for the nomination of Messrs BDO for appointment as Auditors and of the intention to propose the following ordinary resolution:

“THAT Messrs BDO be hereby appointed as the Auditors of the Company in place of the retiring Auditors, Messrs Folks DFK & Co. for the financial year ending 31 March 2012 to hold office until the conclusion of the next Annual General Meeting of the Company at a remuneration to be determined by the Directors.”

Resolution 1

Resolution 2Resolution 3Resolution 4

Resolution 5

Resolution 6


172

AS SPECIAL BUSINESS To consider and if thought fit, to pass the following resolutions, with or without modifications:

Ordinary Resolutions

6. Authority to Issue Shares Pursuant to Section 132D of the Companies Act, 1965 “THAT subject always to the Companies Act, 1965, provisions of the Company’s

Memorandum and Articles of Association and the approval from the relevant authorities, where such approval is necessary, full authority be and is hereby given to the Directors pursuant to Section 132D of the Companies Act, 1965 to issue and allot shares in the Company at any time and upon such terms and conditions and for such purposes as the Directors may, in their absolute discretion deem fit, provided that the aggregate number of shares issued pursuant to this resolution does not exceed ten per centum (10%) of the issued capital of the Company for the time being and that the Directors be and are also empowered to obtain the approval for the listing of and quotation for the additional shares so issued on Bursa Malaysia Securities Berhad and that such authority shall continue in force until the conclusion of the next Annual General Meeting of the Company.”

7. Proposed Shareholders’ Mandate for Recurrent Related Party Transactions of a Revenue or Trading Nature

“THAT subject to Bursa Malaysia Securities Berhad Main Market Listing Requirements,

approval be and is hereby given for the Company and its subsidiaries to enter into the recurrent related party transactions of a revenue or trading nature with the related parties as specified in Section 2.2 of the Circular to Shareholders dated 29 August 2011, provided that the transactions are in the ordinary course of business which are necessary for day-to-day operations and on normal commercial terms which are not more favourable to the related parties than those generally available to the public and are not detrimental to the interest of the minority shareholders of the Company and that the aggregate value of such transactions conducted pursuant to the shareholders’ mandate during the financial year be disclosed in the annual report of the Company;

AND THAT such authority conferred shall continue to be in force until:

(i) the conclusion of the next Annual General Meeting (“AGM”) of the Company, at which time it will lapse, unless by a resolution passed at the AGM, the authority is renewed;

(ii) the expiration of the period within which the next AGM of the Company is required to be held pursuant to Section 143(1) of the Companies Act, 1965 (“Act”) (but must not extend to such extension as may be allowed pursuant to Section 143(2) of the Act); or

(iii) revoked or varied by resolution passed by the shareholders of the Company in general meeting,

whichever is the earlier;


Resolution 7

Resolution 8

Annual Report 2011

173

AND THAT the Directors of the Company be and are hereby authorised to complete and do all such acts and things (including executing such documents as may be required) to give effect to the transactions contemplated and/or authorised by this resolution.”

8. Proposed Renewal of Share Buy-Back Authority

“THAT subject to the Companies Act, 1965 (“the Act”), rules, regulations and orders made pursuant to the Act, provisions of the Memorandum and Articles of Association of the Company, Bursa Malaysia Securities Berhad (“Bursa Securities”) Main Market Listing Requirements and any other relevant authorities, approval be and is hereby given for the Company to purchase ordinary shares of RM0.50 each in the Company as may be determined by the Directors from time to time through Bursa Securities upon such terms and conditions as the Directors of the Company may in their absolute discretion deem fit and expedient in the interest of the Company (“Share Buy-Back Mandate”) provided that:

(i) the aggregate number of ordinary shares of RM0.50 each in the Company which may be purchased and/or held by the Company at any point of time pursuant to the Share Buy-Back Mandate shall not exceed ten per centum (10%) of the issued and paid-up share capital of the Company for the time being;

(ii) the maximum funds to be allocated by the Company for the purpose of purchasing its own shares shall not exceed the aggregate of the retained profits and the share premium account of the Company based on the audited financial statements for the financial year ended 31 March 2011 of RM91,454,459 and RM103,842,246 respectively;

(iii) the authority conferred by this resolution will be effective immediately upon the

passing of this ordinary resolution and will continue to be in force until:

(a) the conclusion of the next Annual General Meeting (“AGM”) of the Company, at which time the said authority will lapse unless by an ordinary resolution passed at the general meeting of the Company, the authority is renewed, either unconditionally or subject to conditions;

(b) the expiration of the period within which the next AGM of the Company is required by law to be held; or

(c) revoked or varied by an ordinary resolution passed by the shareholders in general meeting,

whichever is the earlier;

(iv) the shares so purchased by the Company pursuant to the Share Buy-Back Mandate to be retained as treasury shares which may be distributed as dividends and/or resold on Bursa Securities and/or cancelled;


Resolution 9


174


AND THAT the Directors of the Company be and are hereby authorised to take all such steps as they may consider expedient or necessary to implement and give effect to the Share Buy-Back Mandate.”

9. To transact any other business of which due notice shall have been received.

By Order of the Board

JOHNSON YAP CHOON SENG (MIA 20766)CHUA SIEW CHUAN (MAICSA 0777689)Secretaries

Petaling Jaya29 August 2011

Notes:

1. A member of the Company entitled to attend and vote at the Meeting is entitled to appoint a proxy/proxies to attend and vote in

his stead. A proxy may but need not be a member of the Company.

2. A member shall not be entitled to appoint more than two (2) proxies to attend and vote at the Meeting and a member who appoints

two (2) proxies shall specify the proportion of his shareholdings to be represented by each proxy.

3. Where a member is an authorised nominee as defined in the Securities Industry (Central Depositories) Act 1991, it may appoint

at least one (1) proxy but not more than two (2) proxies in respect of each Securities Account it holds with ordinary shares of the

Company standing to the credit of the said account.

4. The instrument appointing a proxy in the case of an individual, shall be in writing under the hand of the appointer or his attorney

duly authorised in writing or if the appointer is a corporation either under its Common Seal or under the hand of an officer or attorney

duly authorised.

5. The instrument appointing a proxy must be completed, signed and deposited at the Registered Office of the Company at Level

7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur, Malaysia not less than

forty-eight (48) hours before the time appointed for holding the Meeting or any adjournment thereof.

Annual Report 2011

175

Explanatory Notes on Special Business:

(i) Resolution 7 - Authority to Issue Shares Pursuant to Section 132D of the Companies Act, 1965

The Ordinary Resolution proposed under item 6 is for the purpose of seeking a renewal of the general mandate (“General Mandate”) and if passed, will empower the Directors of the Company pursuant to Section 132D of the Companies Act, 1965, to issue and allot new shares in the Company from time to time provided that the aggregate number of shares issued pursuant to the General Mandate does not exceed 10% of the total issued share capital of the Company for the time being. The General Mandate, unless revoked or varied by the Company in general meeting, will expire at the conclusion of the next Annual General Meeting (“AGM”) of the Company.

As at the date of this Notice, no new share in the Company was issued pursuant to the mandate granted to the Directors at the Forty-Fourth AGM of the Company held on 3 September 2010.

The General Mandate will provide flexibility to the Company for any possible fund raising activities, including but not limited to funding future investment, working capital, acquisitions or such other purposes as the Directors consider would be in the interest of the Company.

(ii) Resolution 8 - Proposed Shareholders’ Mandate for Recurrent Related Party Transactions of a Revenue or Trading Nature

The Ordinary Resolution proposed under item 7, if passed, will allow the Company and its subsidiaries to enter into recurrent related party transactions of a revenue or trading nature pursuant to paragraph 10.09 of Bursa Malaysia Securities Berhad Main Market Listing Requirements. This authority, unless revoked or varied at a general meeting, will expire at the conclusion of the next AGM of the Company.

(iii) Resolution 9 - Proposed Renewal of Share Buy-Back Authority

The Ordinary Resolution proposed under item 8, if passed, will allow the Company to purchase up to 10% of the issued and paid-up share capital of the Company. This authority, unless revoked or varied at a general meeting, will expire at the conclusion of the next AGM of the Company.

Further information on the Proposed Shareholders’ Mandate for Recurrent Related Party Transactions of a Revenue or Trading Nature and Proposed Renewal of Share Buy-Back Authority are set out in the Circular/Statement to Shareholders dated 29 August 2011 which is despatched together with the Company’s Annual Report 2011.



176

Annexure A

✄

FORM OF PROXY

I/We ______________________________________ NRIC No./Company No.: __________________________________

of _______________________________________________________________________________________________

being a member/members of AMCORP PROPERTIES BERHAD, hereby appoint __________________________________

_________________________________________________________________________________________________

of _______________________________________________________________________________________________

or failing him/her, _________________________________________________________________________________

of _______________________________________________________________________________________________

or failing him/her, the Chairman of the Meeting as my/our proxy to vote for me/us and on my/our behalf at the Forty-Fifth Annual General Meeting of the Company to be held at Tun Rahah Grand Hall, 1st Floor, Menara Yayasan Tun Razak, 200 Jalan Bukit Bintang, 55100 Kuala Lumpur on Wednesday, 21 September 2011 at 10.30 a.m. and at any adjournment thereof, in the manner as indicated below:

NO. RESOLUTIONS FOR AGAINST1. To approve the payment of Directors’ fees.2. To re-elect Puan Shalina Azman as Director.3. To re-elect Y. Bhg. Tan Sri Lee Lam Thye as Director.4. To re-elect Encik Shahman Azman as Director.5. To re-appoint Y. Bhg. Tan Sri Dato’ Chen Wing Sum as Director.6. To appoint Messrs BDO as Auditors of the Company in place of the retiring Auditors,

Messrs Folks DFK & Co. and to authorise the Directors to fix their remuneration.7. Authority to issue shares pursuant to Section 132D of the Companies Act, 1965.8. Proposed Shareholders’ Mandate for Recurrent Related Party Transactions of a

Revenue or Trading Nature.9. Proposed Renewal of Share Buy-Back Authority.

Please indicate with an “X” in the spaces provided above as to how you wish your votes to be cast. In the absence of specific directions, your proxy will vote or abstain at his/her discretion.

Signed this ___________ day of ___________________ 2011.

___________________________________Signature of Shareholder/Common Seal

Tel no. (During office hours): ___________________________________Notes:1. A member of the Company entitled to attend and vote at the Meeting is entitled to appoint a proxy/proxies to attend and vote in his stead.

A proxy may but need not be a member of the Company. 2. A member shall not be entitled to appoint more than two (2) proxies to attend and vote at the Meeting and a member who appoints two

(2) proxies shall specify the proportion of his shareholdings to be represented by each proxy.3. Where a member is an authorised nominee as defined in the Securities Industry (Central Depositories) Act 1991, it may appoint at least one

(1) proxy but not more than two (2) proxies in respect of each Securities Account it holds with ordinary shares of the Company standing to the credit of the said account.

4. The instrument appointing a proxy in the case of an individual, shall be in writing under the hand of the appointer or his attorney duly authorised in writing or if the appointer is a corporation either under its Common Seal or under the hand of an officer or attorney duly authorised.

5. The instrument appointing a proxy must be completed, signed and deposited at the Registered Office of the Company at Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur, Malaysia not less than forty-eight (48) hours before the time appointed for holding the Meeting or any adjournment thereof.

No. of Shares Held CDS Account No.

Amcorp Properties Berhad(Formerly known as AMDB Berhad)

(6386-K)

STAMP

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The Company Secretary Amcorp Properties Berhad Level 7, Menara MileniumJalan DamanlelaPusat Bandar Damansara Damansara Heights50490 Kuala LumpurMalaysia

w w w . a m c o r p p r o p e r t i e s . c o m

Amcorp Properties Berhad (6386-K) (Formerly known as AMDB Berhad)

2.01 PJ Tower, 18 Persiaran Barat, 46050 Petaling Jaya, Selangor, Malaysia. T : +603-7966 2628 F : +603-7966 2629

Annual Report 2011

Am

corp Properties Berhad

Annual Report 201 1

Amcorp Properties Berhad (6386-K)

AmcorpAR(cov)FA.indd 1 8/16/11 11:06 AM

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